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Arkema S.A. (ARKAY)
OTHER OTC:ARKAY
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Arkema SA
(OTC:ARKAY)
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Rating:66Neutral
Price Target:
$66.00
▲(8.16% Upside)
Arkema's overall stock score reflects a mix of challenges and opportunities. The most significant factor is the company's financial performance, which shows declining revenue growth and profitability margins. Technical analysis indicates a bearish trend, while valuation metrics are favorable with a strong dividend yield. The earnings call provided some positive insights into cost-cutting and future projects, but also highlighted ongoing challenges.
Arkema SA (ARKAY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$4.58B
Dividend Yield6.95%
Average Volume (3M)1.19K
Price to Earnings (P/E)19.4
Beta (1Y)0.91
Revenue Growth0.85%
EPS Growth-36.94%
CountryUS
Employees21,150
SectorBasic Materials
Sector Strength58
IndustryChemicals - Specialty
Share Statistics
EPS (TTM)1.78
Shares Outstanding76,060,830
10 Day Avg. Volume1,534
30 Day Avg. Volume1,186
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap2.18
Enterprise Value/Revenue1.06
Enterprise Value/Gross Profit5.56
Enterprise Value/Ebitda9.08
Forecast
1Y Price Target
$66.00Price Target Upside8.16% Upside
Rating ConsensusHold
Number of Analyst Covering1
Arkema SA Business Overview & Revenue Model
Company DescriptionArkema SA (ARKAY) is a global leader in specialty chemicals and advanced materials, headquartered in France. The company operates through three main segments: High Performance Materials, Industrial Specialties, and Coating Solutions. Arkema's core products include polymers, additives, and coatings that cater to a diverse range of industries, including automotive, construction, electronics, and healthcare. With a strong emphasis on innovation and sustainability, Arkema is committed to developing high-performance solutions that meet the evolving needs of its customers while minimizing environmental impact.
How the Company Makes MoneyArkema generates revenue primarily through the sale of its specialty chemicals and materials across various industries. The company has established key revenue streams through its three main segments, with High Performance Materials being the largest contributor, driven by demand for advanced polymers and composites. Industrial Specialties and Coating Solutions also play significant roles, with products that include adhesives, sealants, and specialty coatings. Additionally, Arkema engages in strategic partnerships and collaborations to enhance its product offerings and expand its market reach, which further contributes to its earnings. The company's focus on innovation allows it to command premium pricing for its specialized products, thereby increasing profitability.
Arkema SA Earnings Call Summary
Earnings Call Date:Jul 31, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 07, 2025
Earnings Call Sentiment Neutral
The earnings call for Arkema's Q2 2025 highlights resilience in certain segments like Advanced Materials and effective cost-cutting measures. However, the company faces challenges in overall revenue decline, particularly in the Coating Solutions segment, and significant currency impacts. While there are promising developments in new projects and capacity expansions, geopolitical and economic uncertainties continue to pose risks.Q2-2025 Updates
Positive Updates
Robust EBITDA Margin
Despite challenges, Arkema maintained a robust EBITDA margin of 15.2% for Q2 2025, showcasing the resilience of its portfolio.
Strong Performance in Advanced Materials
Advanced Materials segment saw a 6% increase in volumes with growth in most businesses, maintaining a margin close to 20%.
Cost-Cutting Measures and Cash Generation
Arkema implemented significant cost-cutting measures, generating a solid recurring cash flow of over EUR 110 million in Q2 2025.
Innovative Projects and Capacity Expansion
Arkema's major projects, like the new capacity for additives in the U.S. and the expansion of organic peroxide in China, are progressing well.
Negative Updates
Overall Revenue Decline
Q2 2025 sales were down 5.6% year-on-year, impacted by a negative 3.3% currency effect and a 1.3% decline in volumes.
Challenges in Coating Solutions
The Coating Solutions segment faced significantly lower performance compared to last year, affected by challenging unit margins in upstream acrylics.
Exchange Rate Impact
EBITDA was negatively impacted by unfavorable currency effects, estimated at EUR 50 million for the quarter.
Geopolitical and Economic Uncertainty
The macroeconomic environment remains challenging with low demand, geopolitical uncertainty, and limited visibility.
Company Guidance
During the conference call, Arkema provided guidance on its financial performance for the second half of 2025, amidst a challenging macroeconomic environment characterized by weak demand in the U.S. and Europe and unfavorable exchange rates. The company projected an EBITDA range of EUR 1.3 billion to EUR 1.4 billion for the year, factoring in a EUR 50 million FX headwind, and anticipated recurring cash flow between EUR 300 million and EUR 400 million. Despite a slight decline in volumes, Arkema reported a robust EBITDA margin of 15.2% in Q2, supported by resilient performance in its Adhesives and Advanced Materials segments. Cost-cutting measures are expected to achieve EUR 100 million in savings for the year, doubling the initial target. The net debt-to-EBITDA ratio was approximately 2.5x, with capital expenditures capped at EUR 650 million for 2025. Arkema emphasized its strategic focus on innovative materials and key growth markets, with significant projects expected to contribute over EUR 400 million to EBITDA by 2028.Arkema SA Financial Statement Overview
Summary
Arkema SA faces challenges with declining revenue growth and profitability margins. The balance sheet remains stable with a reasonable debt level, but cash flow constraints could pose risks. The company needs to focus on improving revenue growth and managing costs to enhance profitability and cash flow generation.Income Statement
Arkema SA's income statement shows a decline in revenue growth with a negative trend in the TTM period. The gross profit margin has slightly decreased over time, indicating pressure on cost management. Net profit margin has also decreased, reflecting challenges in maintaining profitability. However, the company maintains a stable EBIT and EBITDA margin, suggesting operational efficiency.65
Positive
Balance Sheet
The balance sheet reflects a moderate debt-to-equity ratio, indicating a balanced approach to leveraging. The return on equity has decreased over the years, showing a decline in profitability relative to shareholder equity. However, the equity ratio remains strong, suggesting financial stability and a solid asset base.70
Positive
Cash Flow
Cash flow analysis reveals a decline in free cash flow growth, which could impact future investments and dividend payouts. The operating cash flow to net income ratio indicates that cash generation from operations is healthy, but the free cash flow to net income ratio has decreased, highlighting potential liquidity constraints.60
Neutral
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 9.44B | 9.54B | 9.51B | 11.55B | 9.52B | 7.88B |
| Gross Profit | 1.80B | 1.94B | 1.96B | 2.58B | 2.14B | 1.55B |
| EBITDA | 1.10B | 1.31B | 1.33B | 1.97B | 1.87B | 1.22B |
| Net Income | 226.00M | 354.00M | 418.00M | 965.00M | 1.31B | 332.00M |
Balance Sheet | ||||||
| Total Assets | 13.92B | 15.21B | 14.52B | 13.51B | 12.30B | 10.71B |
| Cash, Cash Equivalents and Short-Term Investments | 1.31B | 2.01B | 2.04B | 1.59B | 2.29B | 1.63B |
| Total Debt | 3.79B | 4.55B | 4.28B | 3.26B | 2.76B | 2.80B |
| Total Liabilities | 6.47B | 7.45B | 7.06B | 6.17B | 5.95B | 5.48B |
| Stockholders Equity | 7.23B | 7.53B | 7.20B | 7.30B | 6.30B | 5.19B |
Cash Flow | ||||||
| Free Cash Flow | 222.00M | 353.00M | 593.00M | 766.00M | 152.00M | 510.00M |
| Operating Cash Flow | 1.02B | 1.12B | 1.27B | 1.50B | 915.00M | 1.11B |
| Investing Cash Flow | -900.00M | -940.00M | -1.35B | -2.34B | 473.00M | -458.00M |
| Financing Cash Flow | -964.00M | -207.00M | 516.00M | 168.00M | -652.00M | -535.00M |
Arkema SA Technical Analysis
Negative
61.02
Price Trends
66.52
Negative
69.30
Negative
72.37
Negative
Market Momentum
-1.98
Negative
43.06
Neutral
90.36
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ARKAY, the sentiment is Negative. The current price of 61.02 is below the 20-day moving average (MA) of 61.27, below the 50-day MA of 66.52, and below the 200-day MA of 72.37, indicating a bearish trend. The MACD of -1.98 indicates Negative momentum. The RSI at 43.06 is Neutral, neither overbought nor oversold. The STOCH value of 90.36 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ARKAY.
Arkema SA Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Neutral | $7.07B | 8.61 | 14.52% | 5.42% | 1.60% | -3.97% | |
69 Neutral | $14.36B | 20.91 | 24.05% | 1.83% | 3.09% | 12.25% | |
66 Neutral | $4.58B | 19.39 | 3.48% | 6.95% | 0.85% | -36.94% | |
63 Neutral | $23.06B | 18.12 | 16.88% | 2.63% | -10.59% | -7.79% | |
61 Neutral | $10.43B | 7.12 | -0.05% | 2.87% | 2.86% | -36.73% | |
50 Neutral | $16.57B | ― | -2.74% | 2.47% | -0.07% | 83.36% | |
48 Neutral | $14.67B | 59.85 | 1.08% | 11.99% | -14.12% | -89.22% |
* Basic Materials Sector Average
ARKAY
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61.02
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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.