Element Solutions (ESI) AI Stock Analysis

• Market Cap: $6.41B
• Dividend Yield: 1.21%
• Average Volume (3M): 1.63M
• Price to Earnings (P/E): 27.2
• Beta (1Y): 1.20
• Revenue Growth: 5.41%
• EPS Growth: 23.44%
• Country: US
• Employees: 5,300
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Chemicals - Specialty
• EPS (TTM): 0.37
• Shares Outstanding: 241,616,670
• 10 Day Avg. Volume: 1,851,219
• 30 Day Avg. Volume: 1,629,122
• PEG Ratio: 0.24
• Price to Book (P/B): 2.58
• Price to Sales (P/S): 2.51
• P/FCF Ratio: 20.97
• Enterprise Value/Market Cap: 1.03
• Enterprise Value/Revenue: 2.65
• Enterprise Value/Gross Profit: 6.34
• Enterprise Value/Ebitda: 12.42
• 1Y Price Target: $28.71
• Price Target Upside: 8.30% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 7

• Rating: 80 Outperform
• Price Target: $30.00 ▲(13.16% Upside)

Element Solutions' strong financial performance and positive technical indicators are the primary drivers of its high score. The optimistic earnings call and supportive corporate events further enhance the outlook, although the high valuation tempers the overall score.

Positive Factors

Revenue Growth

Consistent growth in the electronics segment indicates strong demand for ESI's products, supporting long-term revenue expansion and market leadership.

Cash Flow Strength

Robust cash flow generation and a manageable leverage ratio enhance financial flexibility, enabling strategic investments and debt management.

Upward Financial Outlook Revision

The revised financial outlook reflects confidence in future performance, driven by strategic initiatives and market opportunities, bolstering investor confidence.

Negative Factors

High Debt Levels

High debt levels can strain financial resources, limiting the company's ability to invest in growth opportunities and manage economic downturns effectively.

Macroeconomic Uncertainty

Ongoing macroeconomic uncertainties could impact demand and supply chain stability, posing challenges to ESI's growth and profitability.

Weakness in Consumer Electronics

Weak performance in consumer electronics could hinder ESI's growth in this segment, affecting overall revenue and market diversification efforts.

Element Solutions Business Overview & Revenue Model

Company Description

Element Solutions Inc. (ESI) is a global specialty chemicals company that focuses on providing advanced materials and solutions for a variety of sectors, including electronics, industrial, and consumer products. ESI's core product offerings include electronic chemicals, semiconductor materials, and surface treatment technologies, which are essential for the manufacturing of electronic devices, automotive components, and numerous other applications requiring high-performance materials.

How the Company Makes Money

Element Solutions generates revenue primarily through the sale of specialty chemicals and advanced materials to various industries. Key revenue streams include the electronics segment, which contributes significantly through the provision of chemicals used in semiconductor manufacturing and circuit board production. The industrial segment also provides a steady income through surface treatment solutions and coatings for automotive and other industrial applications. Additionally, ESI benefits from strategic partnerships with leading manufacturers and technology firms, which enhance its product offerings and market reach. The company’s focus on innovation and R&D further drives revenue growth by enabling the development of new products that meet evolving industry needs.

Element Solutions Financial Statement Overview

Summary

Element Solutions demonstrates strong profitability and cash flow generation, with a solid balance sheet. The company maintains a healthy gross profit margin and efficient cash conversion, although revenue growth is modest and debt levels require monitoring.

Income Statement

Element Solutions shows a strong gross profit margin of 41.8% in the TTM period, reflecting efficient production costs. The net profit margin of 9.7% and a stable EBIT margin of 13.7% indicate robust operating performance. However, the revenue growth rate is moderate at 1.27% from the previous year, suggesting steady but unspectacular growth. EBITDA margin remains healthy at 14.9%, pointing to good cash generation from operations.

Balance Sheet

The company maintains a solid debt-to-equity ratio of 0.62, indicating a balanced leverage position. Return on equity is commendable at 9.2%, reflecting effective use of shareholder funds. The equity ratio is stable at 52.5%, suggesting a strong asset base. However, the total debt remains significant, which could pose a risk if earnings decline.

Cash Flow

Element Solutions achieves a positive free cash flow growth rate of 9.54% over the previous year, demonstrating improved cash generation capability. The operating cash flow to net income ratio of 1.39 indicates strong cash conversion. The free cash flow to net income ratio of 1.13 further underscores efficient management of cash flows. These metrics suggest a healthy cash position, aiding in financial flexibility.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.49B	2.46B	2.33B	2.55B	2.40B	1.85B
Gross Profit	1.04B	1.04B	918.50M	952.70M	960.80M	786.00M
EBITDA	531.00M	501.60M	345.10M	496.10M	475.50M	305.90M
Net Income	240.40M	244.20M	118.10M	187.20M	203.30M	75.70M
Balance Sheet
Total Assets	5.00B	4.87B	4.97B	4.90B	5.14B	4.48B
Cash, Cash Equivalents and Short-Term Investments	529.90M	359.40M	289.30M	265.60M	330.10M	291.90M
Total Debt	1.62B	1.91B	2.03B	1.98B	1.97B	1.57B
Total Liabilities	2.36B	2.48B	2.63B	2.55B	2.64B	2.17B
Stockholders Equity	2.63B	2.38B	2.33B	2.33B	2.48B	2.32B
Cash Flow
Free Cash Flow	272.20M	293.60M	283.10M	249.90M	276.20M	232.50M
Operating Cash Flow	335.80M	362.00M	335.80M	297.70M	322.50M	261.30M
Investing Cash Flow	293.10M	-73.80M	-250.20M	-75.20M	-568.90M	-39.90M
Financing Cash Flow	-418.50M	-206.60M	-58.70M	-275.60M	290.00M	-123.60M

Element Solutions Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 26.51
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ESI, the sentiment is Positive. The current price of 26.51 is above the 20-day moving average (MA) of 26.01, above the 50-day MA of 24.90, and above the 200-day MA of 23.91, indicating a bullish trend. The MACD of 0.53 indicates Negative momentum. The RSI at 59.40 is Neutral, neither overbought nor oversold. The STOCH value of 67.68 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ESI.

Element Solutions Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ESI	80 Outperform	$6.41B	27.25	9.62%	1.21%	5.41%	23.44%
NEU	76 Outperform	7.67B	16.18	29.80%	1.32%	2.27%	17.81%
BCPC	76 Outperform	5.08B	35.86	11.26%	0.56%	5.74%	21.54%
AXTA	74 Outperform	6.56B	14.88	19.69%	―	-1.01%	50.58%
EMN	70 Neutral	7.48B	9.15	14.26%	5.10%	1.60%	-3.97%
SXT	68 Neutral	4.37B	32.43	11.65%	1.59%	4.95%	53.63%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%

Element Solutions Corporate Events

Element Solutions Revises 2025 Financial Outlook Upward

On July 7, 2025, Element Solutions Inc announced an upward revision of its second quarter and full year 2025 financial outlook. This announcement is expected to positively impact the company’s operations and market positioning, signaling potential growth and increased confidence among stakeholders.