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Element Solutions
(NYSE:ESI)
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Rating:62Neutral
Price Target:
$40.00
▲(6.84% Upside)
Action:Reiterated
Date:07/28/26
The score is driven by strong, guidance-backed operating momentum from the latest earnings call (raised EBITDA outlook, robust Electronics/Semiconductor growth, and margin progress). Offsetting this are weaker underlying financial quality versus prior years (lower margins, softer free-cash-flow profile, and higher leverage) and a technically weak near-term trend. Valuation is an additional constraint due to the high P/E and modest dividend yield.
Positive Factors
End-market growth (Electronics/Semiconductors)
Sustained double-digit organic growth in electronics and semiconductor end markets reflects durable structural demand for process chemistries and recurring consumable sales. Given qualification cycles and program stickiness, outperformance in these high-growth verticals supports multi-quarter revenue visibility and share gains.
Negative Factors
Weakened profitability and cash conversion
Multi-year decline in net margin and a marked drop in free cash flow reduce internal funding capacity and heighten sensitivity to input-cost shocks. Deteriorating cash conversion limits flexibility for buybacks, debt paydown or large organic investments, making results more dependent on execution and mix improvements.
Read all positive and negative factors
Positive Factors
Negative Factors
End-market growth (Electronics/Semiconductors)
Sustained double-digit organic growth in electronics and semiconductor end markets reflects durable structural demand for process chemistries and recurring consumable sales. Given qualification cycles and program stickiness, outperformance in these high-growth verticals supports multi-quarter revenue visibility and share gains.
Read all positive factors
Element Solutions Key Performance Indicators (KPIs)
Any
Adjusted EBITDA by Segment
Shows how much profit each business segment generates after core adjustments, revealing which parts of Element Solutions drive earnings, carry the best margins, and offer the most cash to fund growth or pay down debt. Helps spot operational strength, margin trends, and where cost pressures or scale benefits are concentrated.
Shows how much profit each business segment generates after core adjustments, revealing which parts of Element Solutions drive earnings, carry the best margins, and offer the most cash to fund growth or pay down debt. Helps spot operational strength, margin trends, and where cost pressures or scale benefits are concentrated.
Data provided by:
The Fly
The FlyElement Solutions (ESI) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$9.08B
Dividend Yield0.85%
Average Volume (3M)5.81M
Price to Earnings (P/E)50.7
Beta (1Y)1.25
Revenue Growth26.61%
EPS Growth-25.95%
CountryUS
Employees5,200
SectorBasic Materials
Sector Strength58
IndustryChemicals - Specialty
Share Statistics
EPS (TTM)0.74
Shares Outstanding243,690,920
10 Day Avg. Volume5,331,457
30 Day Avg. Volume5,812,472
Financial Highlights & Ratios
PEG Ratio-1.45
Price to Book (P/B)2.26
Price to Sales (P/S)2.37
P/FCF Ratio26.57
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$48.00Price Target Upside28.21% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering6
EPS Forecast (FY)1.8
Revenue Forecast (FY)$3.65B
Element Solutions Business Overview & Revenue Model
Company Description
Headquartered in Fort Lauderdale, Florida, Element Solutions Inc (ESI) operates as a multinational specialty chemicals enterprise, with significant business operations in the United States, China, and various international territories. The company...
How the Company Makes Money
ESI makes money primarily by manufacturing and selling specialty chemical products and related process solutions, with revenue largely recognized from product shipments to industrial and electronics customers.
Key revenue streams include:
- Elect...
Element Solutions Earnings Call Summary
Earnings Call Date:Jul 27, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 28, 2026
Earnings Call Sentiment Positive
The call presented a strongly positive operational and financial performance: record revenue, significant organic growth (15% overall; 20% in Electronics; 31% in Semiconductors), margin expansion, healthy cash flow ($74M adjusted FCF), successful acquisitions (Micromax, EFC) and raised guidance (adjusted EBITDA $690–710M; adjusted EPS growth ~20%). Offsetting risks include raw material and metals price volatility, inflationary pressure in non-metal inputs, lumpiness in certain acquired businesses, elevated incentive accruals, integration execution risk around the announced Solstice merger and a pro forma leverage of 2.9x. On balance, the positives (broad-based growth, margin progress, strong cash generation, upgraded guidance and strategic capacity investments like Cuprion) materially outweigh the near-term headwinds and execution risks.Positive Updates
Record Quarterly Financials
Delivered record quarterly revenue, adjusted EBITDA and adjusted EPS; organic net sales grew 15% year-over-year and constant-currency adjusted EBITDA increased 33% YoY. Management reported adjusted EPS increased 27% in Q2.
Negative Updates
Raw Material and Metals Price Volatility
Pass-through metals caused top-line volatility (material mix impact); non-metal raw material inflation (ethylene/propylene derivatives) and logistics pressures—exacerbated by geopolitical risk in Iran—are a headwind and may not be immediately recaptured via pricing.
Read all updates
Q2-2026 Updates
Positive
Negative
Record Quarterly Financials
Delivered record quarterly revenue, adjusted EBITDA and adjusted EPS; organic net sales grew 15% year-over-year and constant-currency adjusted EBITDA increased 33% YoY. Management reported adjusted EPS increased 27% in Q2.
Read all positive updates
Company Guidance
Management raised full‑year adjusted EBITDA guidance to $690–$710 million and reiterated Q3 adjusted EBITDA of about $180 million, while guiding to roughly 20% adjusted EPS growth for 2026 and a reduction in pro‑forma net leverage from 2.9x at quarter‑end to about 2.5x by year‑end; Q2 facts supporting the guide included $74 million of adjusted free cash flow, Q2 capex of $28 million (YTD >$50M) with full‑year CapEx now expected to be roughly $100 million (<3% of sales), company organic net sales up 15% (Electronics +20%, Semiconductors +31%), constant‑currency adjusted EBITDA +33% YoY, adjusted EBITDA margin ex pass‑through metals +120 bps to 27.8% (nearly 30% excluding above‑target incentive accruals), Micromax contributed ~ $130 million to reported sales and EFC ~$16 million, and the guide reflects first‑half metal hedge gains and an expectation of similar demand into Q3 with cash generation weighted to the second half.Element Solutions Financial Statement Overview
Summary
Income Statement
66
Positive
Balance Sheet
60
Neutral
Cash Flow
54
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 3.15B | 2.55B | 2.46B | 2.33B | 2.55B | 2.40B |
| Gross Profit | 1.21B | 1.07B | 1.04B | 918.50M | 952.70M | 960.80M |
| EBITDA | 379.80M | 320.80M | 501.60M | 345.10M | 496.10M | 475.50M |
| Net Income | 178.60M | 190.80M | 244.20M | 118.10M | 187.20M | 203.30M |
Balance Sheet | ||||||
| Total Assets | 5.78B | 5.10B | 4.87B | 4.97B | 4.90B | 5.14B |
| Cash, Cash Equivalents and Short-Term Investments | 189.60M | 626.50M | 359.40M | 289.30M | 265.60M | 330.10M |
| Total Debt | 2.12B | 1.64B | 1.91B | 2.03B | 1.98B | 1.97B |
| Total Liabilities | 2.96B | 2.41B | 2.48B | 2.63B | 2.55B | 2.64B |
| Stockholders Equity | 2.81B | 2.67B | 2.38B | 2.33B | 2.33B | 2.48B |
Cash Flow | ||||||
| Free Cash Flow | 131.60M | 227.60M | 293.60M | 283.10M | 249.90M | 276.20M |
| Operating Cash Flow | 218.10M | 289.80M | 362.00M | 335.80M | 297.70M | 322.50M |
| Investing Cash Flow | -955.70M | 286.10M | -73.80M | -250.20M | -75.20M | -568.90M |
| Financing Cash Flow | 402.10M | -320.40M | -206.60M | -58.70M | -275.60M | 290.00M |
Element Solutions Technical Analysis
Negative
37.44
Price Trends
40.93
Negative
39.89
Negative
34.19
Positive
Market Momentum
-0.87
Negative
45.55
Neutral
65.01
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ESI, the sentiment is Negative. The current price of 37.44 is below the 20-day moving average (MA) of 37.53, below the 50-day MA of 40.93, and above the 200-day MA of 34.19, indicating a neutral trend. The MACD of -0.87 indicates Negative momentum. The RSI at 45.55 is Neutral, neither overbought nor oversold. The STOCH value of 65.01 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ESI.
Element Solutions Risk Analysis
Element Solutions disclosed 33 risk factors in its most recent earnings report. Element Solutions 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
Element Solutions Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $8.37B | 19.77 | 24.63% | 1.51% | -1.31% | -7.93% | |
76 Outperform | $5.65B | 34.96 | 12.79% | 0.59% | 10.14% | 16.56% | |
71 Outperform | $8.01B | 22.87 | 14.59% | ― | -0.92% | -20.25% | |
70 Outperform | $8.40B | 19.32 | 7.42% | 4.91% | -4.30% | -46.24% | |
69 Neutral | $5.51B | 35.36 | 13.02% | 1.31% | 8.12% | 16.87% | |
62 Neutral | $9.08B | 50.69 | 6.57% | 0.85% | 26.61% | -25.95% | |
61 Neutral | $10.43B | 7.12 | -0.05% | 2.87% | 2.86% | -36.73% |
* Basic Materials Sector Average
ESI
Element Solutions
37.65
13.13
53.52%
BCPC
Balchem
179.01
19.12
11.96%
EMN
Eastman Chemical
74.77
14.36
23.77%
NEU
Newmarket
917.09
167.81
22.40%
SXT
Sensient Technologies
131.90
15.42
13.24%
AXTA
Axalta Coating Systems
37.28
7.81
26.50%
Element Solutions Corporate Events
Executive/Board ChangesDelistings and Listing ChangesM&A TransactionsRegulatory Filings and Compliance
Element Solutions to Merge with Solstice Advanced Materials
Positive
Jul 6, 2026
On July 6, 2026, Element Solutions entered into a merger agreement with Solstice Advanced Materials that will see Element Solutions become a wholly owned subsidiary of Solstice through a two-step reorganization. Element Solutions shareholders are ...
Executive/Board ChangesShareholder Meetings
Element Solutions Investors Reject Say-on-Pay at Annual Meeting
Negative
May 5, 2026
On May 4, 2026, Element Solutions Inc held its 2026 annual meeting of stockholders, with approximately 96% of outstanding common shares represented in person or by proxy. Stockholders elected eight director nominees to serve until the 2027 annual ...
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.