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Arkema S.A. (ARKAY)
:ARKAY
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Arkema SA
(OTC:ARKAY)
Rating:69Neutral
Price Target:
$78.00
▲(5.43%Upside)
Arkema SA (ARKAY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$5.61B
Dividend Yield5.24%
Average Volume (3M)657.00
Price to Earnings (P/E)16.4
Beta (1Y)0.78
Revenue Growth1.70%
EPS Growth-11.22%
CountryUS
Employees21,150
SectorBasic Materials
Sector Strength70
IndustryChemicals - Specialty
Share Statistics
EPS (TTM)1.48
Shares Outstanding76,060,830
10 Day Avg. Volume609
30 Day Avg. Volume657
Financial Highlights & Ratios
PEG Ratio-0.25
Price to Book (P/B)0.85
Price to Sales (P/S)0.00
P/FCF Ratio8.11
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
Arkema SA Business Overview & Revenue Model
Company DescriptionArkema SA is a global leader in specialty chemicals and advanced materials, headquartered in Colombes, France. The company operates in three main segments: High Performance Materials, Industrial Specialties, and Coating Solutions. Arkema's core products and services include adhesives, high-performance polymers, fluorochemicals, and acrylics, catering to diverse industries such as automotive, construction, electronics, and packaging.
How the Company Makes MoneyArkema SA generates revenue through the sale of a wide range of specialty chemicals and advanced materials. The High Performance Materials segment, which includes high-performance polymers and adhesives, is a significant contributor to revenue, driven by demand from industries like automotive and electronics. The Industrial Specialties segment, which encompasses fluorochemicals and thiochemicals, benefits from applications in refrigeration, pharmaceuticals, and petrochemicals. The Coating Solutions segment, focusing on acrylics and resins, serves the paint, coatings, and adhesive markets. Arkema also engages in strategic partnerships and acquisitions to enhance its product offerings and expand its market presence. The company's earnings are influenced by factors such as raw material costs, technological innovation, and global economic conditions.
Arkema SA Earnings Call Summary
Earnings Call Date:May 07, 2025
(Q1-2025)
| % Change Since: 4.37%|
Next Earnings Date:Jul 31, 2025
Earnings Call Sentiment Neutral
Arkema's Q1 2025 earnings call highlighted strong growth in Asia and successful integration of acquisitions, while facing challenges with weak demand in Europe and the U.S., and significant declines in the Intermediates segment. The company remains optimistic about future growth through major projects and renewable energy initiatives.Q1-2025 Updates
Positive Updates
Strong Performance in Asia
Asia demonstrated significant growth, particularly in high-performance polymers, with a 7% increase in EBITDA for Advanced Materials driven by the dynamic of new business developments in batteries, electronics, and sports.
Impressive Growth in PI Advanced Materials
PI Advanced Materials (PIAM) saw its EBITDA increase by more than 70% in Q1, supported by the rising demand for ultra-thin PI films for smartphones.
Successful Integration of Dow's Laminating Adhesives
Bostik benefited from the integration of Dow's laminating adhesives, starting well and contributing to sales with a positive scope effect of EUR 51 million.
Progress in Major Projects
Arkema is progressing with the ramp-up of the 1233zd unit in the U.S. and the greenfield polyamide 11 plant in Singapore, which is expected to exceed breakeven by summer.
Renewable Energy Initiatives
Arkema signed a long-term agreement with ENGIE for the supply of biomethane for Bostik in France, covering 85% of gas consumption from renewable sources.
Negative Updates
Weak Market Conditions in Europe and the U.S.
Demand was globally slow across most markets in Europe and the U.S. due to ongoing uncertainty around trade tariffs and a wait-and-see attitude from customers.
EBITDA Decline
Overall EBITDA was slightly down at EUR 329 million, a 6% decrease from last year, mainly due to significant decreases in the Intermediates segment.
Challenges in the Intermediates Segment
Intermediates, representing 7% of sales, saw a significant decrease due to weak refrigerant gases, with the segment's EBITDA down nearly 40% year-on-year.
Low Cycle Conditions in Coating Solutions
Coating Solutions experienced low cycle conditions in upstream acrylic, affecting segment performance with EBITDA at EUR 58 million.
High Working Capital Outflows
Q1 recurring cash flow was at minus EUR 138 million, attributed to working capital seasonality and a significant payout in the quarter.
Company Guidance
During the Q1 2025 results conference call, Arkema's CEO Thierry Le Hénaff provided guidance amidst a challenging macroeconomic environment characterized by volatility and uncertainty, particularly due to trade tariffs. The company reported an EBITDA of EUR 329 million, a slight 6% decline year-on-year, with Specialty Materials showing resilience despite a 3% decline. Advanced Materials saw a 7% EBITDA increase, driven by high-performance polymers and significant growth in Asia. Arkema aims to achieve an EBITDA at least equal to last year's and a recurring cash flow close to EUR 600 million for 2025. Key projects include the ramp-up of new production units, with expectations for significant contributions in the second half of the year. The company is also progressing with its greenfield polyamide 11 plant in Singapore and planning a new PVDF capacity in the U.S., projecting high returns with a USD 20 million investment. Arkema remains focused on cost control, operational efficiency, and leveraging its global industrial footprint to navigate the uncertainties of global trade dynamics.Arkema SA Financial Statement Overview
Summary
Arkema SA demonstrates a mixed financial performance, with stable revenue but declining profitability margins and returns on equity. While debt levels are manageable, the decrease in free cash flow suggests potential liquidity pressures. The company needs to address operational efficiencies and cash flow management to sustain its financial health.Income Statement
Arkema SA shows a stable income statement with a slight decline in total revenue from 2022 to 2024. The gross profit margin remained healthy, hovering around 20% over the years. However, net profit margin decreased from 11.3% in 2021 to 3.7% in 2024, indicating declining profitability. EBIT and EBITDA margins also showed a downward trend, reflecting challenges in maintaining operational efficiency.70
Positive
Balance Sheet
The balance sheet reflects moderate stability with a reasonable debt-to-equity ratio, increasing from 0.52 in 2020 to 0.61 in 2024. The equity ratio improved, suggesting a stronger equity position over total assets. However, the return on equity dropped from 20.8% in 2021 to 4.7% in 2024, indicating diminished returns for shareholders.75
Positive
Cash Flow
Arkema's cash flow statements reveal a challenging situation with free cash flow significantly decreasing from 2020 to 2024 due to higher capital expenditures. The operating cash flow to net income ratio remained stable, but the free cash flow to net income ratio has weakened, reflecting reduced cash generation capacity relative to net income.65
Positive
| Breakdown | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 9.54B | 9.51B | 11.55B | 9.52B | 7.88B |
| Gross Profit | 1.94B | 1.96B | 2.58B | 2.14B | 1.55B |
| EBITDA | 1.31B | 1.33B | 1.97B | 1.87B | 1.22B |
| Net Income | 354.00M | 418.00M | 965.00M | 1.31B | 332.00M |
Balance Sheet | |||||
| Total Assets | 15.21B | 14.52B | 13.51B | 12.30B | 10.71B |
| Cash, Cash Equivalents and Short-Term Investments | 2.01B | 2.04B | 1.59B | 2.29B | 1.63B |
| Total Debt | 4.55B | 4.28B | 3.26B | 2.76B | 2.80B |
| Total Liabilities | 7.45B | 7.06B | 6.17B | 5.95B | 5.48B |
| Stockholders Equity | 7.53B | 7.20B | 7.30B | 6.30B | 5.19B |
Cash Flow | |||||
| Free Cash Flow | 353.00M | 593.00M | 766.00M | 152.00M | 510.00M |
| Operating Cash Flow | 1.12B | 1.27B | 1.50B | 915.00M | 1.11B |
| Investing Cash Flow | -940.00M | -1.35B | -2.34B | 473.00M | -458.00M |
| Financing Cash Flow | -207.00M | 516.00M | 168.00M | -652.00M | -535.00M |
Arkema SA Technical Analysis
Positive
73.98
Price Trends
71.99
Positive
74.73
Positive
77.34
Positive
Market Momentum
0.94
Negative
65.93
Neutral
85.96
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ARKAY, the sentiment is Positive. The current price of 73.98 is above the 20-day moving average (MA) of 71.37, above the 50-day MA of 71.99, and below the 200-day MA of 77.34, indicating a bullish trend. The MACD of 0.94 indicates Negative momentum. The RSI at 65.93 is Neutral, neither overbought nor oversold. The STOCH value of 85.96 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ARKAY.
Arkema SA Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $6.75B | 15.12 | 23.59% | ― | 0.96% | 82.78% | |
71 Outperform | $14.56B | 22.70 | 25.53% | 1.80% | -0.61% | 15.06% | |
69 Neutral | $5.61B | 16.40 | 4.87% | 5.24% | 1.70% | -11.22% | |
69 Neutral | $9.19B | 10.13 | 16.16% | 4.17% | 2.78% | 1.50% | |
64 Neutral | $26.85B | 20.03 | 18.47% | 2.29% | -7.67% | -0.58% | |
63 Neutral | $64.60B | 42.19 | 10.45% | 2.47% | -1.09% | -37.71% | |
62 Neutral | $10.29B | 9.96 | -0.15% | 2.86% | 2.14% | -32.15% |
* Basic Materials Sector Average
Performance Comparison
ARKAY
Arkema SA
73.98
-13.32
-15.26%
APD
Air Products and Chemicals
291.84
43.12
17.34%
EMN
Eastman Chemical
79.57
-12.78
-13.84%
PPG
PPG Industries
118.28
-5.81
-4.68%
RPM
RPM International
113.36
8.70
8.31%
AXTA
Axalta Coating Systems
30.87
-3.49
-10.16%
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.