Axalta Coating Systems (AXTA) AI Stock Analysis

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Axalta Coating Systems

(NYSE:AXTA)

Rating:73Outperform

Price Target:

$34.00

▲(6.99% Upside)

Axalta Coating Systems' overall stock score is driven by strong financial performance and positive earnings call highlights, including record-breaking adjusted EBITDA and strategic cost management. Technical indicators show positive short-term momentum, though the stock faces longer-term resistance. The valuation is reasonable, but the absence of a dividend yield may limit its attractiveness to some investors.

Positive Factors

Strong Financial Performance

Record-breaking EBITDA reflects strong operational execution and cost management, indicating robust financial health and resilience in challenging markets.

Operational Excellence

Operational improvements and cost reductions enhance profitability and competitiveness, supporting long-term growth and efficiency.

Balance Sheet Health

Reduced leverage enhances financial stability and flexibility, allowing for strategic investments and weathering economic fluctuations.

Negative Factors

Decline in Performance Coatings Sales

Declining sales in a key segment could impact revenue and market share, posing challenges to maintaining growth momentum.

Refinish Segment Challenges

Weakness in the Refinish segment, particularly in North America, could affect overall profitability and market position in the automotive sector.

Softer Demand Environment

Prolonged demand softness could pressure sales and margins, requiring strategic adjustments to sustain growth and profitability.

Axalta Coating Systems (AXTA) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$6.70B

Dividend YieldN/A

Average Volume (3M)2.80M

Price to Earnings (P/E)15.2

Beta (1Y)1.05

Revenue Growth-1.01%

EPS Growth50.58%

CountryUS

Employees12,900

SectorBasic Materials

Sector Strength60

IndustryChemicals - Specialty

Share Statistics

EPS (TTM)0.64

Shares Outstanding216,574,140

10 Day Avg. Volume1,977,626

30 Day Avg. Volume2,804,719

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 Cap1.39

Enterprise Value/Revenue1.79

Enterprise Value/Gross Profit5.25

Enterprise Value/Ebitda8.50

Forecast

1Y Price Target

$36.00

Price Target Upside13.28% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering12

Axalta Coating Systems Business Overview & Revenue Model

Company DescriptionAxalta Coating Systems (AXTA) is a leading global manufacturer of liquid and powder coatings, serving a wide range of industries including automotive, industrial, and architectural sectors. The company specializes in providing high-performance coatings and innovative technologies that enhance the durability and appearance of surfaces. Axalta's core products include automotive paints and coatings, industrial coatings, and decorative architectural coatings, catering to both OEMs (original equipment manufacturers) and refinish markets.

How the Company Makes MoneyAxalta generates revenue primarily through the sale of its coatings products across various markets. The company operates through multiple segments, including Performance Coatings and Transportation Coatings, each contributing significantly to its overall earnings. Key revenue streams include the sale of automotive coatings to OEMs and the refinish market, as well as industrial coatings for manufacturing and construction applications. Additionally, Axalta benefits from strategic partnerships with automotive manufacturers and distributors, which enhance its market presence and distribution capabilities. The company's focus on innovation and technology also allows it to command premium pricing for its high-performance coatings, further contributing to its profitability.

Axalta Coating Systems Key Performance Indicators (KPIs)

Any

Revenue by Segment

Revenue by Segment
Breaks down revenue by different business segments, highlighting which areas drive growth and profitability, and revealing strategic focus and market opportunities.

Chart InsightsAxalta Coating Systems' Performance Coatings Refinish segment faces challenges with declining volumes due to reduced collision claims and inventory adjustments, despite a long-term upward trend. The Industrial segment is also under pressure from macroeconomic softness. However, the Mobility Coatings segment shows resilience with organic growth, particularly in China and Latin America, contributing to record EBITDA margins. Strategic initiatives in cost management and innovation are crucial as Axalta navigates North American market challenges, aiming to sustain its financial momentum and operational excellence.

Data provided by:

Main Street Data

Axalta Coating Systems Earnings Call Summary

Earnings Call Date:Jul 30, 2025

(Q2-2025)

% Change Since: |

Next Earnings Date:Oct 28, 2025

Earnings Call Sentiment Neutral

Axalta demonstrated strong financial performance with record-breaking adjusted EBITDA and EPS amid a challenging market environment. The Mobility segment and operational excellence initiatives were key drivers of this success. However, challenges persist in the Performance Coatings and Refinish segments, particularly in North America. Despite these challenges, the company's disciplined execution and strategic focus position it well for future growth.

Q2-2025 Updates

Positive Updates

Record-Breaking Adjusted EBITDA and EPS

Axalta delivered a record quarter for adjusted EBITDA at $292 million and adjusted diluted earnings per share, despite a challenging global market. This marks the fifth consecutive quarter with adjusted EBITDA margins at or above 21%.

Strong Performance in Mobility Segment

The Mobility segment achieved 2% organic growth, driven by strength in China and Latin America. Adjusted EBITDA margin in this segment expanded by 500 basis points to nearly 20%.

Operational Excellence and Cost Management

Axalta improved its safety record by 55% year-over-year and reduced operating expenses by 6%, driven by $40 million in cost savings from transformation initiatives and closing three manufacturing plants.

Positive Free Cash Flow and Share Repurchases

Cash flow from operations increased 25% year-over-year, driving free cash flow to $101 million. Axalta executed $65 million in share repurchases this quarter.

Negative Updates

Decline in Performance Coatings Sales

Net sales for Performance Coatings declined 6% year-over-year due to lower volumes and unfavorable price-mix, primarily in North America.

Refinish Segment Challenges in North America

The Refinish segment faced headwinds with a 6% decline in net sales year-over-year, impacted by lower collision claims and distributor inventory corrections.

Expected Prolonged Softer Demand Environment

The softer demand environment observed in the first half of the year is expected to persist longer than anticipated, impacting full-year sales expectations.

Company Guidance

During Axalta Coating Systems' Q2 2025 earnings call, the company reported robust financial performance, achieving a record adjusted EBITDA of $292 million with margins exceeding 22%, marking the fifth consecutive quarter above their 21% target. Net sales reached just over $1.3 billion, aligning with their guidance. Axalta executed $65 million in share repurchases and maintained a focus on capital deployment. The Mobility segment reported 2% organic growth, driven by strength in China and Latin America, achieving adjusted EBITDA margins near 20%. Performance Coatings saw net sales decline by 6% year-over-year, but nearly 2% growth was realized from adjacencies and retail. Cash flow from operations increased 25% year-over-year, resulting in $101 million in free cash flow. Full-year adjusted EBITDA is now expected to be between $1.14 billion and $1.165 billion, with adjusted diluted earnings per share projected to range from $2.45 to $2.55.

Axalta Coating Systems Financial Statement Overview

Summary

Axalta Coating Systems demonstrates solid financial health with strong profitability and efficient cash flow management. The company has shown consistent revenue and profit growth, supported by effective cost control and operational efficiency. While the balance sheet is stable, attention to leverage and maintaining growth in free cash flow will be crucial for sustaining long-term financial stability.

Income Statement

Very Positive

Axalta Coating Systems shows strong financial performance with a consistent revenue growth trajectory, evidenced by a 7.3% increase from 2022 to 2023 and a 1.8% increase from 2023 to 2024. The gross profit margin is robust at 33.0% for TTM, and the net profit margin has improved significantly to 8.6% TTM, indicating effective cost management. EBIT and EBITDA margins are also healthy at 14.5% and 19.9% TTM respectively, showcasing operational efficiency. However, a slight dip in total revenue in the latest TTM period suggests a need for vigilance in maintaining growth momentum.

Balance Sheet

Positive

The balance sheet reflects a stable financial position with a debt-to-equity ratio of 1.65, which is moderate for the industry. The equity ratio stands at 28.0% TTM, indicating a solid equity base. Return on equity has improved to 21.6% TTM, demonstrating efficient use of shareholder funds. While the company has managed its debt levels well, the high total liabilities relative to assets suggest potential leverage risks that need monitoring.

Cash Flow

Very Positive

Cash flow analysis reveals a strong operating cash flow to net income ratio of 1.26 TTM, indicating robust cash generation relative to profits. The free cash flow to net income ratio is 0.91 TTM, reflecting healthy cash flow after capital expenditures. Free cash flow growth has been positive, with a slight decline in the latest TTM period, suggesting the need for careful capital allocation to sustain growth.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	5.20B	5.28B	5.18B	4.88B	4.42B	3.74B
Gross Profit	1.77B	1.80B	1.62B	1.42B	1.43B	1.28B
EBITDA	1.10B	1.05B	857.30M	700.00M	778.80M	598.30M
Net Income	446.00M	391.00M	267.40M	191.60M	263.90M	121.60M
Balance Sheet
Total Assets	7.78B	7.25B	7.27B	7.06B	7.22B	7.16B
Cash, Cash Equivalents and Short-Term Investments	625.00M	593.00M	700.20M	645.20M	840.60M	1.36B
Total Debt	20.00M	3.52B	3.54B	3.81B	3.94B	4.00B
Total Liabilities	5.47B	5.29B	5.50B	5.56B	5.68B	5.68B
Stockholders Equity	2.27B	1.91B	1.73B	1.45B	1.49B	1.43B
Cash Flow
Free Cash Flow	415.00M	436.00M	437.40M	142.90M	437.00M	427.20M
Operating Cash Flow	598.00M	576.00M	575.30M	293.80M	558.60M	509.30M
Investing Cash Flow	-487.00M	-440.00M	-205.70M	-106.40M	-716.00M	-61.50M
Financing Cash Flow	-329.00M	-201.00M	-315.00M	-368.90M	-334.50M	-130.90M

Axalta Coating Systems Technical Analysis

Technical Analysis Sentiment

Positive

Last Price31.78

Price Trends

50DMA

30.23

Positive

100DMA

30.69

Positive

200DMA

33.14

Negative

Market Momentum

MACD

0.45

Negative

RSI

57.82

Neutral

STOCH

44.17

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AXTA, the sentiment is Positive. The current price of 31.78 is above the 20-day moving average (MA) of 31.19, above the 50-day MA of 30.23, and below the 200-day MA of 33.14, indicating a neutral trend. The MACD of 0.45 indicates Negative momentum. The RSI at 57.82 is Neutral, neither overbought nor oversold. The STOCH value of 44.17 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AXTA.

Axalta Coating Systems Risk Analysis

Axalta Coating Systems disclosed 47 risk factors in its most recent earnings report. Axalta Coating Systems reported the most risks in the "Finance & Corporate" category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Axalta Coating Systems Peers Comparison

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RPM	78 Outperform	$15.99B	23.28	25.42%	1.59%	0.51%	17.21%
AXTA	73 Outperform	$6.70B	15.21	22.09%	―	-1.01%	50.58%
SHW	72 Outperform	$91.92B	35.50	62.43%	0.84%	0.31%	2.66%
EMN	70 Neutral	$7.47B	9.14	14.52%	4.86%	1.60%	-3.97%
PPG	63 Neutral	$24.55B	19.29	16.88%	2.46%	-10.59%	-7.79%
Sector *	61 Neutral	$10.48B	7.30	-0.05%	2.85%	2.87%	-36.73%
IFF	50 Neutral	$16.53B	83.39	-2.74%	2.41%	-0.07%	83.36%

* Basic Materials Sector Average

Performance Comparison

AXTA

Axalta Coating Systems

31.78

-3.02

-8.68%

EMN

Eastman Chemical

67.93

-31.51

-31.69%

IFF

International Flavors & Fragrances

66.35

-35.30

-34.73%

PPG

PPG Industries

111.83

-12.13

-9.79%

RPM

RPM International

128.23

8.98

7.53%

SHW

Sherwin-Williams Company

368.68

-3.59

-0.96%

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: Sep 12, 2025