Evonik (EVK) AI Stock Analysis

• Market Cap: €9.03B
• Dividend Yield: 6.04%
• Average Volume (3M): 1.03M
• Price to Earnings (P/E): 30.2
• Beta (1Y): 0.90
• Revenue Growth: 0.53%
• EPS Growth: N/A
• Country: DE
• Employees: 31,585
• Sector: Industrials
• Sector Strength: 88
• Industry: Chemicals - Specialty
• EPS (TTM): 0.59
• Shares Outstanding: 466,000,000
• 10 Day Avg. Volume: 917,991
• 30 Day Avg. Volume: 1,027,891
• PEG Ratio: 0.82
• Price to Book (P/B): 0.97
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 9.97
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: €21.59
• Price Target Upside: 13.63% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 12

• Rating: 67 Neutral
• Price Target: €20.50 ▲(7.89%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 Business Overview & Revenue Model

Company Description

Evonik 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 Money

Evonik 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

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

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

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
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
15.14B	15.16B	15.27B	18.49B	14.96B	12.20B
	Gross Profit
3.75B	3.74B	3.39B	4.23B	4.03B	3.37B
	EBIT
952.00M	639.00M	630.00M	1.43B	1.24B	886.00M
	EBITDA
1.76B	1.76B	1.73B	2.07B	2.18B	1.76B
	Net Income Common Stockholders
299.00M	222.00M	-465.00M	540.00M	746.00M	465.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.31B	618.00M	1.03B	1.12B	919.00M	1.06B
	Total Assets
20.24B	21.07B	21.26B	21.81B	22.28B	20.90B
	Total Debt
0.00	3.78B	4.25B	4.22B	3.64B	3.84B
	Net Debt
-733.00M	3.32B	3.50B	3.58B	3.19B	3.27B
	Total Liabilities
10.97B	11.97B	12.28B	10.75B	12.91B	12.80B
	Stockholders Equity
9.19B	9.02B	8.91B	10.97B	9.29B	8.01B
Cash Flow		Free Cash Flow
893.00M	873.00M	801.00M	785.00M	929.00M	771.00M
	Operating Cash Flow
1.67B	1.71B	1.59B	1.65B	1.81B	1.73B
	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 Price: 19.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: 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 is below the 20-day moving average (MA) of 19.04, above the 50-day MA of 18.49, and above the 200-day MA of 18.13, indicating a bullish trend. The MACD of 0.16 indicates Negative momentum. The RSI at 60.59 is Neutral, neither overbought nor oversold. The STOCH value of 46.38 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

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EVK	67 Neutral	€9.03B	30.21	3.25%	6.04%	0.53%	―
Sector *	66 Neutral	$4.51B	12.29	5.40%	3.67%	4.15%	-12.21%
0MPT		€8.95B	16.84	11.49%	3.44%	―	―
0RBE		€11.02B	―	-6.00%	―	―	―
FPE	74 Outperform	€5.69B	16.13	15.87%	3.16%	2.58%	8.02%
LNXSF		$2.73B	―	-3.92%	0.36%	―	―
WKCMF		$3.73B	14.23	5.37%	3.77%	―	―