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Evonik (DE:EVK)
XETRA:EVK

Evonik (EVK) AI Stock Analysis

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Evonik

(XETRA:EVK)

Rating:67Neutral
Price Target:
€20.50
▲(6.66%Upside)
Evonik's overall stock score is driven primarily by stable cash flow and positive technical indicators, despite challenges in financial performance due to declining revenues and profitability. The high P/E ratio suggests a premium valuation, partially offset by a strong dividend yield. Technical indicators point to potential bullish momentum, which contributes significantly to the score.
Positive Factors
Cost Management
Cost savings, more favorable energy costs, and FX tailwinds are expected to drive EBITDA above the mid-point of the guidance.
Financial Performance
The CEO expressed confidence in the FY-25 guidance, with a solid start in Q1 and expectations for EBITDA to increase year-over-year.
Market Position
Evonik is resilient to US tariffs, as the company benefits from high tariffs on Chinese methionine imports to the US.
Negative Factors
Earnings Impact
Q4 EBITDA was lower than expected due to one-time effects, with all segments below expectations except for Others.
Industry Challenges
Structural changes in the European chemical industry indicate that 15-20% of value chains are lost and will not return, leading to plant closures.

Evonik (EVK) vs. iShares MSCI Germany ETF (EWG)

Evonik Business Overview & Revenue Model

Company DescriptionEvonik Industries AG engages in the specialty chemicals business. It operates through Specialty Additives, Nutrition & Care, Smart Materials, Performance Materials, and Technology & Infrastructure segments. The Specialty Additives segment provides polyurethane additives, organically modified silicones, isophorones, epoxy curing agents, oil additives, fumed silicas, matting agents, TAA and TAA derivatives, and acetylenic diol-based surfactants for consumer goods and specialized industrial applications. The Nutrition & Care segment offers amphoteric surfactants, ceramides, phytosphingosines, oleochemicals, quaternary derivatives, amino acids and amino acid derivatives, synthesis products, pharmaceutical polymers, and DL-methionine for use in consumer goods, animal nutrition, and healthcare products. The Smart Materials segment provides hydrogen peroxide, peracetic acid, activated nickel catalysts, precious metal powder catalysts, oil and fat hydrogenation catalysts, amorphous polyalphaolefins, polybutadienes, polyester resins, thermoplastic and reactive methacrylate resins, PEEK, polyamide 12, organosilanes, chlorosilanes, fumed silicas, fumed metal oxides, and precipitated silicas for the automotive, paints, coatings, adhesives, construction, and various other sectors. The Performance Materials segment produces polymer materials and intermediates, including butene-1, DINP, isononanol, cyanuric chloride, alkoxides, and superabsorbent for rubber, plastics, and automotive industries. The Technology & Infrastructure segment provides site management, utilities and waste management, technical, process technology, engineering, and logistics services. It operates in the Asia-Pacific, Europe, the Middle East, Africa, Central and South America, and North America. The company was founded in 1873 and is headquartered in Essen, Germany. Evonik Industries AG is a subsidiary of RAG-Stiftung.
How the Company Makes MoneyEvonik makes money primarily through the sale of specialty chemicals and related products across its key business segments: Nutrition & Care, Resource Efficiency, and Performance Materials. The company generates revenue by providing high-value, innovative chemical products that meet specific customer needs, often under long-term contracts. Its earnings are bolstered by strategic partnerships and collaborations with industry leaders, allowing Evonik to leverage its expertise and expand its market reach. Additionally, the company's focus on research and development enables it to continuously innovate and maintain a competitive edge in the specialty chemicals market.

Evonik Financial Statement Overview

Summary
Evonik's financial performance is challenged by declining revenues and inconsistent profitability, affecting the income statement. The balance sheet shows moderate stability with a manageable debt-to-equity ratio, although return on equity is low. Cash flow remains a positive aspect with consistent operating and free cash flow generation, providing some operational resilience.
Income Statement
55
Neutral
Evonik's income statement shows a declining revenue trend with a significant drop from 2022 to 2023. Gross profit margin remains relatively stable but net income has been inconsistent, with a notable loss in 2023. EBIT margin is concerning due to zero EBIT in 2024. EBITDA margin reflects operational profitability but the absence of EBIT reduces confidence in core earnings. Overall, revenue decline and inconsistent profitability pose challenges.
Balance Sheet
65
Positive
The balance sheet of Evonik reflects moderate stability. The debt-to-equity ratio has remained manageable, indicating a balanced approach to leveraging. Return on equity is low due to recent net income losses, reducing shareholder returns. The equity ratio is stable, suggesting a solid capital structure, though maintaining profitability is crucial to enhance equity value.
Cash Flow
70
Positive
Cash flow metrics present a positive aspect for Evonik, with consistent operating cash flow and free cash flow generation. The operating cash flow to net income ratio is strong, demonstrating efficient cash earnings. Although free cash flow growth is limited, the ability to cover net income with cash flow indicates operational resilience, despite profitability issues.
Breakdown
TTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
15.14B15.16B15.27B18.49B14.96B12.20B
Gross Profit
3.75B3.74B3.39B4.23B4.03B3.37B
EBIT
952.00M639.00M630.00M1.43B1.24B886.00M
EBITDA
1.76B1.76B1.73B2.07B2.18B1.76B
Net Income Common Stockholders
299.00M222.00M-465.00M540.00M746.00M465.00M
Balance SheetCash, Cash Equivalents and Short-Term Investments
1.31B618.00M1.03B1.12B919.00M1.06B
Total Assets
20.24B21.07B21.26B21.81B22.28B20.90B
Total Debt
0.003.78B4.25B4.22B3.64B3.84B
Net Debt
-733.00M3.32B3.50B3.58B3.19B3.27B
Total Liabilities
10.97B11.97B12.28B10.75B12.91B12.80B
Stockholders Equity
9.19B9.02B8.91B10.97B9.29B8.01B
Cash FlowFree Cash Flow
893.00M873.00M801.00M785.00M929.00M771.00M
Operating Cash Flow
1.67B1.71B1.59B1.65B1.81B1.73B
Investing Cash Flow
-928.00M-663.00M-653.00M-777.00M-1.07B-570.00M
Financing Cash Flow
-753.00M-1.22B-823.00M-672.00M-856.00M-1.73B

Evonik Technical Analysis

Technical Analysis Sentiment
Positive
Last Price19.22
Price Trends
50DMA
18.49
Positive
100DMA
18.43
Positive
200DMA
18.13
Positive
Market Momentum
MACD
0.15
Positive
RSI
57.54
Neutral
STOCH
20.21
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:EVK, the sentiment is Positive. The current price of 19.22 is above the 20-day moving average (MA) of 18.99, above the 50-day MA of 18.49, and above the 200-day MA of 18.13, indicating a bullish trend. The MACD of 0.15 indicates Positive momentum. The RSI at 57.54 is Neutral, neither overbought nor oversold. The STOCH value of 20.21 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DE:EVK.

Evonik Peers Comparison

Overall Rating
UnderperformOutperform
Sector (66)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
DEEVK
67
Neutral
€8.90B29.773.25%6.12%0.53%
66
Neutral
$4.50B12.295.40%248.66%4.13%-12.33%
€8.81B16.5811.49%3.45%
€11.06B-6.00%
DEFPE
74
Outperform
€5.56B15.7615.87%3.20%2.58%8.02%
$2.53B-3.92%0.36%
$3.52B13.675.37%3.77%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
DE:EVK
Evonik
19.22
1.50
8.47%
GB:0MPT
Brenntag AG
60.96
-1.99
-3.16%
GB:0RBE
Covestro
60.06
8.15
15.70%
DE:FPE
Fuchs Petrolub
36.70
2.85
8.42%
LNXSF
LANXESS
29.75
5.62
23.29%
WKCMF
Wacker Chemie AG
72.70
-26.53
-26.74%
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.