Fact based stock research
Element Solutions (NYSE:ESI)

US28618M1062

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

Element Solutions stock research in summary

elementsolutionsinc.com

ANALYSIS: With an Obermatt Combined Rank of 82 (better than 82% compared with investment alternatives), Element Solutions (Specialty Chemicals, USA) shares have much better financial characteristics than comparable stocks. Shares of Element Solutions are low in value (priced high) with a consolidated Value Rank of 39 (worse than 61% of alternatives). But they show above-average growth (Growth Rank of 89) and are safely financed (Safety Rank of 64, which means below-average debt burdens). ...read more

RECOMMENDATION: A Combined Rank of 82, is a strong buy recommendation based on Element Solutions's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Element Solutions exhibits low value (Obermatt Value Rank of 39), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 89). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 64) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	39
Growth Rank	89
Safety Rank	64
Combined Rank	82

Country	USA
Industry	Specialty Chemicals
Index
Size class	Large

14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Element Solutions

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	54	43	31	39
GROWTH
GROWTH	76	93	51	89
SAFETY
SAFETY	15	33	53	64
SENTIMENT
SENTIMENT	n/a	85	76	^new
360° VIEW
360° VIEW	n/a	75	55	^new

Most recent update of the stock research: 14-Nov-2024. Financial reporting date used for calculating ranks: 30-Jun-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Element Solutions is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	54	43	31	39
GROWTH
GROWTH	76	93	51	89
SAFETY
SAFETY	15	33	53	64
COMBINED
COMBINED	38	53	34	82

Last update of combined financial performance: 14-Nov-2024. Stock analysis on combined financial performance: The higher the rank of Element Solutions the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 39 (worse than 61% compared with alternatives), Element Solutions shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with all four indicators below average for Element Solutions. Price-to-Sales is 28 which means that the stock price compared with what market professionals expect for future profits is higher than 72% of comparable companies, indicating a low value concerning Element Solutions's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 45, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of Element Solutions. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 46 and Dividend Yield, which is lower than 53% of comparable companies, also make the stock more expensive compared with investment alternatives. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 39, is a hold recommendation based on Element Solutions's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for Element Solutions? One reason may be that the company is simply too popular. If enough people want a particular stock, its price can exceed reasonable levels. This is often the case for companies offering new and exciting products and everybody wants a piece of the action. Should you pay a lot for a hot stock such as Element Solutions? It's risky, and even if the stock price continues to grow because of popular demand, it may return to more typical lower levels later. And that return can be sudden and quick, making it impossible for retail investors to exit on time. Sometimes, high prices are deserved. This is the case when it is justified to believe that the company will dominate a market with high profit margins. It has happened in the past for many technology companies and indeed for commercially successful pharmaceutical discoveries. Sometimes they last, sometimes, they get eaten alive. Element Solutions may be such a type of stock. That would mean, retail investors should be careful, only considering investing a small part of their wealth in this exciting category and always being ready to lose more than half, if not all of the investment. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	37	29	21	28
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	55	51	56	46
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	46	55	45	45
DIVIDEND YIELD
DIVIDEND YIELD	72	53	39	47
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	54	43	31	39

Last update of Value Rank: 14-Nov-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Element Solutions; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 89 (better than 89% compared with alternatives) for 2024, Element Solutions shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all four indicators above average for Element Solutions. Sales Growth has a value of 53, which means that, currently, professionals expect the company to grow more than 53% of its competitors. The same is valid for Profit Growth with a value of 71 and for Capital Growth with 65. In addition, Stock Returns had an above-average rank value of 79, which means they have been higher than 79% of comparable investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 89, is a buy recommendation for growth and momentum investors. Since all Growth Ranks are positive, Element Solutions exhibits above-average growth momentum. This could be due to a uniquely strong market position, proprietary technology, or an extensive corporate acquisition strategy. Growth investors will find this an attractive investment opportunity, unless they expect that the current phase is transitory and will deteriorate in the future. The current performance could also be a temporary recovery from a very low point, such as a turn-around situation. In the case of a turn-around, the current performance may or may not be followed by a continuing positive development. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	58	84	65	53
PROFIT GROWTH
PROFIT GROWTH	100	57	48	71
CAPITAL GROWTH
CAPITAL GROWTH	n/a	67	26	65
STOCK RETURNS
STOCK RETURNS	76	79	77	79
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	76	93	51	89

Last update of Growth Rank: 14-Nov-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Element Solutions.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 64 (better than 64% compared with alternatives), the company Element Solutions has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Element Solutions is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, where all three are above average for Element Solutions. Leverage is at 50, meaning the company has a below-average debt-to-equity ratio. It has less debt than 50% of its competitors. Refinancing is at a rank of 50, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 50% of its competitors. Finally, Liquidity is also good at a rank of 61, which means that the company generates more profit to service its debt than 61% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 64 (better than 64% compared with alternatives), Element Solutions has a financing structure that is safer than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. Investors may not have a debt issue with Element Solutions but they should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	14	62	50	50
REFINANCING
REFINANCING	60	49	51	50
LIQUIDITY
LIQUIDITY	27	19	52	61
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	15	33	53	64

Last update of Safety Rank: 14-Nov-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Element Solutions and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	62	89	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	35	34	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	77	45	^new
MARKET PULSE
MARKET PULSE	n/a	58	79	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	85	76	^new

Last update of Sentiment Rank: 14-Nov-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Element Solutions.
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