Ashland (ASH) AI Stock Analysis

• Market Cap: $2.25B
• Dividend Yield: 3.29%
• Average Volume (3M): 604.35K
• Price to Earnings (P/E): 21.0
• Beta (1Y): 0.92
• Revenue Growth: -7.63%
• EPS Growth: -157.37%
• Country: US
• Employees: 3,200
• Sector: Basic Materials
• Sector Strength: 65
• Industry: Chemicals - Specialty
• EPS (TTM): 0.99
• Shares Outstanding: 45,694,534
• 10 Day Avg. Volume: 530,530
• 30 Day Avg. Volume: 604,350
• PEG Ratio: 0.05
• Price to Book (P/B): 0.92
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 53.23
• Enterprise Value/Market Cap: 1.60
• Enterprise Value/Revenue: 0.40
• Enterprise Value/Gross Profit: 5.91
• Enterprise Value/Ebitda: 4.57
• 1Y Price Target: $66.71
• Price Target Upside: 31.40% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 8

• Rating: 44 Neutral
• Price Target: ―

Ashland faces significant financial challenges with declining revenue and profitability issues, despite a stable balance sheet. Technical indicators suggest a bearish trend, and valuation remains unattractive due to negative earnings. While some operational efficiencies are expected, current conditions warrant caution.

Positive Factors

Financial Performance

Ashland Global Holdings reported better-than-expected FY1Q25, as better margins in Life Sciences and Personal Care offset weaker revenues.

Innovation and Growth

Ashland is finally entering a period where its investments in innovation help validate the transformation into a more consistent, higher-return specialty chemical company.

Investment Potential

The current share price represents a satisfactory entry point, making Ashland a more interesting longer-term investment.

Negative Factors

Market Challenges

ASH may face incrementally higher pressure from tariff/macroeconomic challenges compared to other names under coverage, compounded by unfavorable pricing.

Sales and Pricing Pressures

The segment disappointed with organic sales down 12%, including volume decline in pharma along with pricing pressures.

Uncertainty in Core Segments

ASH continues to see uncertainty around its core Life Sciences segment and the timing of overall organic recovery also remains unclear.

Ashland Business Overview & Revenue Model

Company Description

Ashland Inc. provides additives and specialty ingredients worldwide. It operates through Life Sciences; Personal Care & Household; Specialty Additives; and Intermediates and Solvents segments. The Life Sciences segment offers pharmaceutical solutions, including controlled release polymers, disintegrants, tablet coatings, thickeners, solubilizers, and tablet binders; nutrition solutions, such as thickeners, stabilizers, emulsifiers, and additives; and nutraceutical solutions comprising products for weight management, joint comfort, stomach and intestinal health, sports nutrition, and general wellness, as well as custom formulation, toll processing, and particle engineering solutions. The Personal Care & Household segment provides a range of nature-based, biodegradable, and performance ingredients; solutions for toothpastes, mouth washes and rinses, denture cleaning, and care for teeth; and household supplies nature-derived rheology ingredients, biodegradable surface wetting agents, performance encapsulates, and specialty polymers. The Specialty Additives segment offers rheology modifiers, foam control agents, surfactants and wetting agents, pH neutralizers, advanced ceramics used in catalytic converters, environmental filters, ingredients for the manufacturing of ceramic capacitors, plasma display panels and solar cells, ingredients for textile printing, thermoplastic metals, and alloys for welding. The Intermediates and Solvents segment produces 1,4 butanediol and related derivatives, including n-methylpyrrolidone. It offers its products to customers in a range of consumer and industrial markets, such as architectural coatings, construction, energy, food and beverage, nutraceuticals, personal care, and pharmaceutical. The company was formerly known as Ashland Global Holdings Inc. Ashland Inc. was founded in 1924 and is based in Wilmington, Delaware.

How the Company Makes Money

Ashland makes money through the production and sale of specialty chemicals and additives. The company's revenue model is primarily based on selling these high-performance materials to a diverse range of industries. Ashland generates revenue across several key segments, including Life Sciences, Personal Care, Specialty Additives, and Intermediates and Solvents. The company benefits from long-term partnerships and contracts with major industry players, allowing it to secure stable revenue streams. Additionally, Ashland invests in research and development to create innovative products that meet evolving customer needs, thereby maintaining competitive advantage and driving sales growth.

Ashland Financial Statement Overview

Summary

Ashland's financial performance is under pressure with declining revenues, negative profitability metrics, and weakening cash flow generation. The balance sheet remains moderately stable with controlled leverage, but the negative trends in income and cash flow suggest difficulties in maintaining growth and profitability.

Income Statement

Ashland's TTM financial performance shows a decline in total revenue with a significant negative net income, indicative of profitability challenges. The TTM gross profit margin is approximately 31.28%, which has decreased from previous years, reflecting reduced efficiency in managing production costs. EBIT and EBITDA margins are negative and low, respectively, impacting overall profitability. Revenue has been declining over the past few years, indicating potential demand issues or competitive pressures in the market.

Balance Sheet

Ashland exhibits a relatively stable balance sheet with a debt-to-equity ratio of approximately 0.58, showing moderate leverage. However, the equity ratio is around 48.89%, indicating a balanced capital structure. Despite the declining stockholders' equity, the company's ability to manage its debt levels provides some stability. The return on equity has turned negative in the TTM, highlighting a decrease in shareholder value generation.

Cash Flow

The TTM cash flow analysis reveals a significant drop in operating cash flow compared to previous periods, affecting liquidity. Free cash flow has decreased considerably, impacting the company's ability to invest or return capital to shareholders. The operating cash flow to net income ratio is not meaningful due to a negative net income, suggesting operational cash generation issues. Overall, cash flow stability is a concern, demanding improved operational efficiency.

Breakdown
TTM	Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Income Statement		Total Revenue
1.95B	2.11B	2.19B	2.39B	2.11B	2.33B
	Gross Profit
610.00M	618.00M	668.00M	830.00M	670.00M	707.00M
	EBIT
-145.00M	-26.00M	172.00M	246.00M	181.00M	662.00M
	EBITDA
42.00M	360.00M	517.00M	580.00M	503.00M	-202.00M
	Net Income Common Stockholders
-125.00M	169.00M	178.00M	181.00M	173.00M	-491.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
168.00M	300.00M	417.00M	646.00M	210.00M	454.00M
	Total Assets
5.23B	5.64B	5.94B	6.21B	6.61B	6.88B
	Total Debt
1.49B	1.47B	1.46B	1.38B	2.10B	2.00B
	Net Debt
1.32B	1.17B	1.04B	737.00M	1.89B	1.55B
	Total Liabilities
2.67B	2.78B	2.84B	2.99B	3.86B	3.84B
	Stockholders Equity
2.56B	2.87B	3.10B	3.22B	2.75B	3.04B
Cash Flow		Free Cash Flow
43.00M	325.00M	73.00M	-326.00M	455.00M	65.00M
	Operating Cash Flow
165.00M	462.00M	243.00M	-213.00M	560.00M	203.00M
	Investing Cash Flow
-27.00M	-102.00M	-109.00M	1.56B	-381.00M	8.00M
	Financing Cash Flow
-411.00M	-479.00M	-371.00M	-896.00M	-426.00M	9.00M

Ashland Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 50.77
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ASH, the sentiment is Negative. The current price of 50.77 is below the 20-day moving average (MA) of 50.86, below the 50-day MA of 52.59, and below the 200-day MA of 70.13, indicating a bearish trend. The MACD of -0.58 indicates Negative momentum. The RSI at 47.64 is Neutral, neither overbought nor oversold. The STOCH value of 27.46 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ASH.

Ashland Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AVNT	72 Outperform	$3.41B	34.47	4.32%	2.94%	3.58%	-5.17%
KWR	68 Neutral	$1.98B	21.20	6.78%	1.79%	-5.72%	-19.82%
IOSP	66 Neutral	$2.19B	82.98	2.21%	1.81%	-7.91%	-81.73%
FUL	65 Neutral	$3.04B	28.25	6.35%	1.66%	0.99%	-27.62%
OLN	58 Neutral	$2.23B	38.13	2.94%	4.13%	-1.13%	-81.74%
Sector *	50 Neutral	$2.00B	-1.13	-21.16%	3.71%	2.15%	-30.95%
ASH	44 Neutral	$2.25B	21.03	-3.02%	3.29%	-7.63%	-157.37%

Ashland Corporate Events

Ashland Appoints New Interim CFO Amid Leadership Changes

On May 1, 2025, Ashland Inc. announced the resignation of J. Kevin Willis from his roles as Senior Vice President, Chief Financial Officer, Principal Financial Officer, and Principal Accounting Officer, effective May 16, 2025, to pursue another opportunity. His departure was not due to any disagreements with the company. Subsequently, on May 5, 2025, the Board appointed William C. Whitaker as Interim Chief Financial Officer and Samuel A. Richardson as Vice President, Controller, and Principal Accounting Officer, both effective May 6, 2025. These appointments are part of Ashland’s strategic realignment in its financial leadership, with Whitaker and Richardson bringing extensive experience within the company to their new roles.

Ashland Reports Q2 2025 Sales Decline and Outlook Revision

Ashland Inc. reported its second-quarter fiscal 2025 results, showing a 17% decrease in sales to $479 million compared to the prior year, primarily due to its Portfolio Optimization initiatives. The company revised its full-year outlook, highlighting the impact of mixed demand environments and lower-than-expected sales volumes. Despite these challenges, Ashland is focusing on accelerating cost savings from its manufacturing optimization plans, with the Life Sciences and Personal Care business units achieving robust EBITDA margins above 30% this quarter. The company anticipates that its cost reduction and manufacturing optimization initiatives will continue to support results through the second half of the fiscal year and into fiscal 2026.