Morgan Advanced Materials (BA29) AI Stock Analysis

Morgan Advanced Materials

(LSE:BA29)

Select Model

Rating:58Neutral

Price Target:GBX 70.00▲(3.70% Upside)

Action:reiterated

Date:10/20/26

The score is driven primarily by mixed financial performance: improving recent cash flow is a clear positive, but softer revenue trends, weaker 2025 bottom-line results, and moderate-to-elevated leverage limit the outlook. Technical indicators add downside pressure (below longer-term moving averages with slightly negative MACD). Valuation helps due to a very low P/E, while earnings-call guidance is constructive but tempered by one-off benefits, ongoing cost programs, and above-target leverage.

Positive Factors

Specialized engineered materialsMorgan serves demanding applications where performance under heat, corrosion, wear and electrical stress is important. This specialized capability can support customer qualification, product differentiation and more durable relationships than participation in broadly standardized industrial markets.

Negative Factors

Weak revenue and earnings trendRecent revenue contraction signals a tougher demand environment across the business, while the sharp fall in net income despite higher operating profit points to weaker earnings quality. Together, these trends make near-term profit growth less consistent and increase execution sensitivity.

Morgan Advanced Materials (BA29) vs. iShares MSCI United Kingdom ETF (EWC)

Market Cap: GBP 199.95M
Dividend Yield: 740.74%
Average Volume (3M): 5,000
Price to Earnings (P/E): 3.9
Beta (1Y): -0.11
Revenue Growth: ―
EPS Growth: ―
Country: UK
Employees: 8,694
Sector: General
Sector Strength: 55
Industry: Industrial - Machinery

Morgan Advanced Materials Business Overview & Revenue Model

Company Description

Morgan Advanced Materials PLC is a UK-based enterprise focused on developing and manufacturing a wide variety of advanced and high-specification materials. Their diverse product offerings encompass high-temperature insulation solutions aimed at energ...

Morgan Advanced Materials Earnings Call Summary

Earnings Call Date:Aug 05, 2026(Q2-2026)|% Change Since:0.00%|Next Earnings Date:Jul 25, 2018

Earnings Call SentimentNeutral

The call conveyed balanced progress: the company reported underlying organic growth, improved segment performance (notably Technical Ceramics), clear execution on major operational turnarounds and procurement initiatives, and a credible roadmap to hit a 12% margin by 2028. However, near-term results were aided by a non-repeatable GBP 8.9m take-or-pay benefit, certain divisions (Performance Carbon, European Thermal) face softness, there were operational disruptions earlier in the year, and leverage remains above target. Delivery of planned site turnarounds, procurement savings and ERP completion will be critical to sustain momentum and achieve margin targets.

Positive Updates

Revenue and Organic Growth

Group revenue of GBP 518m for H1 2026; organic constant currency growth of 4.8% including an GBP 8.9m take-or-pay phasing benefit, and 3.0% organic constant currency growth excluding that one-off phasing item.

Negative Updates

Take-or-Pay Phasing Benefit Not Repeatable

An GBP 8.9m take-or-pay payment in H1 2026 materially aided revenue and margins (added ~160 basis points to margin); this benefit will not repeat in H2, reducing comparability and underlying organic performance.

Company Guidance

The company guided to around 2% organic constant‑currency revenue growth for full‑year 2026 and said H2 adjusted operating margin should be broadly in line with H1 excluding a one‑off £8.9m take‑or‑pay benefit (the payment added ~160bps to H1 margin); 2026 specific guidance includes ERP spend of £22–24m, simplification costs of ~£10m (program closing), and capital expenditure of ~£50m (weighted to H2; c.1.2x depreciation over the next three years); net finance charge is expected to be c.£24m, effective tax rate 27–29%, and year‑end leverage c.1.7x (net debt £253m excl. leases at 30 June, ~2x EBITDA with a target range of 1–1.5x); management expects positive free cash flow by end‑2027 and remains on track for a 12% adjusted operating margin in 2028 (14% longer term); H1 metrics referenced alongside this guidance were revenue £518m (+4.8% organic CC including the £8.9m phasing benefit; +3% ex that benefit), headline adjusted operating profit £57.8m (margin 11.2% or 9.6% ex take‑or‑pay), adjusted EPS 10.7p, free cash inflow £3.5m, ROIC 14.5%, and simplification run‑rate savings of £27m (implementation cost £45m).

Morgan Advanced Materials Financial Statement Overview

Summary

Overall fundamentals are mixed. Revenue has weakened recently and 2025 net income fell sharply despite higher operating profit, pointing to below-the-line pressure and less consistent earnings quality. Offsetting this, 2025 cash generation improved materially with a sharp rebound in free cash flow, though multi-year cash-flow volatility and moderate-to-elevated leverage (debt around equity and declining equity) keep risk elevated.

Income Statement

58Neutral

Balance Sheet

53Neutral

Cash Flow

64Positive

Financial statement breakdown
Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	992.10M	996.60M	1.10B	1.11B	1.11B	950.50M
Gross Profit	87.50M	198.30M	813.20M	120.80M	244.70M	207.10M
EBITDA	130.10M	212.00M	150.00M	138.60M	188.10M	156.30M
Net Income	18.40M	21.10M	50.30M	47.30M	88.00M	73.80M
Balance Sheet
Total Assets	1.05B	984.80M	1.08B	1.02B	1.03B	925.40M
Cash, Cash Equivalents and Short-Term Investments	153.10M	126.50M	118.60M	124.50M	117.70M	127.30M
Total Debt	405.80M	360.70M	393.70M	356.80M	318.10M	223.80M
Total Liabilities	697.60M	635.90M	687.80M	626.10M	602.30M	575.80M
Stockholders Equity	319.10M	316.60M	353.70M	360.30M	389.00M	310.60M
Cash Flow
Free Cash Flow	54.80M	53.50M	17.20M	18.10M	-37.40M	74.60M
Operating Cash Flow	94.70M	120.60M	113.30M	78.50M	20.60M	106.20M
Investing Cash Flow	-28.80M	-55.00M	-86.00M	-60.20M	-57.00M	-13.90M
Financing Cash Flow	-46.40M	-99.50M	-33.00M	-2.00M	23.40M	-112.20M

Morgan Advanced Materials Technical Analysis

Technical Analysis SentimentNegative

Last Price67.50

Price Trends

50DMA67.50Neutral

100DMA67.88Negative

200DMA68.34Negative

Market Momentum

MACD-0.00Negative

RSI0.15Positive

STOCH100.00Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:BA29, the sentiment is Negative. The current price of 67.50 is equal to the 20-day moving average (MA) of 67.50, equal to the 50-day MA of 67.50, and below the 200-day MA of 68.34, indicating a neutral trend. The MACD of -0.00 indicates Negative momentum. The RSI at 0.15 is Positive, neither overbought nor oversold. The STOCH value of 100.00 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:BA29.

Morgan Advanced Materials Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

GB:BA29 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GB:IMI	76Outperform	GBP 6.75B	21.01	32.41%	1.23%	7.67%	45.97%
GB:ROR	76Outperform	GBP 4.02B	33.18	21.48%	1.69%	2.22%	25.89%
GB:BOY	67Neutral	GBP 1.55B	26.93	9.30%	2.55%	1.68%	111.96%
GB:WEIR	65Neutral	GBP 6.59B	25.06	13.45%	1.65%	5.84%	-14.62%
GB:SMIN	61Neutral	GBP 7.39B	4.29	92.97%	1.80%	-33.55%	4.29%
GB:BA29	58Neutral	GBP 721.44M	3.86	14.09%	740.74%	―	―
Sector *	55Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%

* General Sector Average

Performance Comparison

GB:BA29 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
GB:BA29	Morgan Advanced Materials (BA29)	67.50	-2.00	-2.88%
GB:BOY	Bodycote plc	915.50	314.37	52.30%
GB:IMI	IMI plc	2878.00	526.10	22.37%
GB:ROR	Rotork (ROR)	494.00	159.76	47.80%
GB:SMIN	Smiths Group plc	2697.00	209.93	8.44%
GB:WEIR	Weir Group plc (The)	2556.00	-319.21	-11.10%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.

Date of analysis: Oct 20, 2026

Morgan Advanced Materials AI Stock Analysis