Morgan Advanced Materials PLC (GB:MGAM)
LSE:MGAM
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Morgan Advanced Materials
(LSE:MGAM)
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Rating:62Neutral
Price Target:
237.00 p
▲(6.04% Upside)
Action:ReiteratedDate:03/05/26
The score is led by mixed fundamentals: strong and improving cash flow is a clear positive, but recent revenue/profit deterioration and meaningful leverage constrain the financial profile. Technicals are notably weak with the stock in a downtrend, partially offset by supportive valuation (low P/E and high dividend). Earnings call guidance suggests modest improvement, but ongoing semiconductor/segment weakness and higher financing costs keep risk elevated.
Positive Factors
Cash generation
Stronger operating cash flow (~£120.6m) and a rebound in free cash flow provide durable capacity to service debt, fund steady capex and ERP rollout, and sustain dividends. Reliable cash conversion reduces refinancing risk and supports execution of medium‑term restructuring and growth plans.
Negative Factors
Revenue cyclicality & semiconductor exposure
Material exposure to semiconductor volumes drove a tangible revenue hit (~£33m) and a c.6.7% volume decline, showing end‑market cyclicality. Semiconductor inventory and mix weakness can persist through multiple quarters, reducing visibility and delaying sustainable top‑line recovery despite cost actions.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash generation
Stronger operating cash flow (~£120.6m) and a rebound in free cash flow provide durable capacity to service debt, fund steady capex and ERP rollout, and sustain dividends. Reliable cash conversion reduces refinancing risk and supports execution of medium‑term restructuring and growth plans.
Read all positive factors
Morgan Advanced Materials (MGAM) vs. iShares MSCI United Kingdom ETF (EWC)
Market Cap
£592.91M
Dividend Yield4.87%
Average Volume (3M)509.96K
Price to Earnings (P/E)28.9
Beta (1Y)1.55
Revenue Growth-9.46%
EPS Growth-57.37%
CountryUK
Employees8,479
SectorIndustrials
Sector Strength72
IndustryIndustrial - Machinery
Share Statistics
EPS (TTM)0.11
Shares Outstanding276,676,420
10 Day Avg. Volume479,214
30 Day Avg. Volume509,962
Financial Highlights & Ratios
PEG Ratio-0.50
Price to Book (P/B)1.93
Price to Sales (P/S)0.61
P/FCF Ratio11.39
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
£230.00Price Target Upside2.91% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering5
EPS Forecast (FY)0.17
Revenue Forecast (FY)£1.01B
Morgan Advanced Materials Business Overview & Revenue Model
Company Description
Morgan Advanced Materials plc operates as a materials science and application engineering company primarily the United Kingdom. It offers high-temperature insulating fibers, microporous, firebrick and insulating firebrick, monolithic, heat shields...
How the Company Makes Money
Morgan Advanced Materials makes money primarily by selling engineered, high-performance materials and components to industrial and technology customers, typically under B2B contracts. Revenue is generated from (1) product sales of manufactured com...
Morgan Advanced Materials Earnings Call Summary
Earnings Call Date:Mar 03, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Jul 31, 2026
Earnings Call Sentiment Neutral
The call presents a balanced picture: the group delivered resilient margins and free cash flow, achieved notable growth in Aerospace/Defense and fire protection, and progressed transformation and portfolio actions. However, meaningful near‑term headwinds persist—semiconductor volumes and mix weakness, a GBP 15.6m impairment, Thermal Products under strategic review, elevated specific adjusting items, and leverage slightly above target. Management has clear plans for efficiency, targeted growth and portfolio optimization with guidance for modest revenue growth (1%–2%) and margin recovery to ~10% in 2026, but execution and market recovery will determine outcomes.Positive Updates
Resilient headline margin and operating profit
Group headline adjusted operating profit of GBP 99.1m with an adjusted operating margin of 9.6%, described as resilient and in line with expectations despite challenging markets.
Negative Updates
Revenue contraction driven by semiconductor downturn
Organic constant currency revenue declined 3.3% in 2025, with volume decline of c.6.7%. The semiconductor downturn accounted for around GBP 33m of the revenue decline and remained weak (silicon carbide inventory adjustments persisting).
Read all updates
Q4-2025 Updates
Positive
Negative
Resilient headline margin and operating profit
Group headline adjusted operating profit of GBP 99.1m with an adjusted operating margin of 9.6%, described as resilient and in line with expectations despite challenging markets.
Read all positive updates
Company Guidance
The company guided that for 2026 it expects organic constant-currency end‑market revenue growth of 1–2%, with adjusted operating margin returning to around 10% (after a 9.6% margin in 2025), supported by pricing of c.3.5% offsetting c.5% COGS inflation, continued simplification/efficiency (which delivered 1.7 percentage points in 2025) and net transform benefits of c.£11m in 2026 (with procurement/site initiatives targeted to deliver at least £20m of margin improvement by 2028); capital expenditure is expected to be c.£50m (around 1.2x depreciation) for the next three years, ERP spend c.£20m in 2026 (winding down in 2027), net finance charge c.£24m (impacted by expiry of £94m fixed debt at ~3%), an effective tax rate of c.27–29%, year‑end leverage around 1.7x with a plan to bring leverage to ~1.5x over the next two years, a maintained dividend this year with growth in line with adjusted earnings once cover returns to ~2.5x, and an ongoing review of the Thermal Products division.Morgan Advanced Materials Financial Statement Overview
Summary
Income Statement
54
Neutral
Balance Sheet
57
Neutral
Cash Flow
68
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 996.60M | 1.10B | 1.11B | 1.11B | 950.50M |
| Gross Profit | 87.50M | 813.20M | 120.80M | 244.70M | 207.10M |
| EBITDA | 130.50M | 150.00M | 138.60M | 188.10M | 156.30M |
| Net Income | 21.10M | 50.30M | 47.30M | 88.00M | 73.80M |
Balance Sheet | |||||
| Total Assets | 984.80M | 1.08B | 1.02B | 1.03B | 925.40M |
| Cash, Cash Equivalents and Short-Term Investments | 126.50M | 118.60M | 124.50M | 117.70M | 127.30M |
| Total Debt | 360.70M | 393.70M | 356.80M | 318.10M | 223.80M |
| Total Liabilities | 635.90M | 687.80M | 626.10M | 602.30M | 575.80M |
| Stockholders Equity | 316.60M | 353.70M | 360.30M | 389.00M | 310.60M |
Cash Flow | |||||
| Free Cash Flow | 53.50M | 17.20M | 18.10M | -37.40M | 74.60M |
| Operating Cash Flow | 120.60M | 113.30M | 78.50M | 20.60M | 106.20M |
| Investing Cash Flow | -55.00M | -86.00M | -60.20M | -57.00M | -13.90M |
| Financing Cash Flow | -99.50M | -33.00M | -2.00M | 23.40M | -112.20M |
Morgan Advanced Materials Technical Analysis
Positive
223.50
Price Trends
211.57
Positive
211.80
Positive
207.04
Positive
Market Momentum
3.51
Negative
66.09
Neutral
80.41
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:MGAM, the sentiment is Positive. The current price of 223.5 is above the 20-day moving average (MA) of 200.90, above the 50-day MA of 211.57, and above the 200-day MA of 207.04, indicating a bullish trend. The MACD of 3.51 indicates Negative momentum. The RSI at 66.09 is Neutral, neither overbought nor oversold. The STOCH value of 80.41 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:MGAM.
Morgan Advanced Materials Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | £7.65B | 15.58 | 13.71% | 1.93% | -31.27% | -13.26% | |
71 Outperform | £850.09M | 15.43 | 33.12% | 1.01% | 24.42% | 103.25% | |
71 Outperform | £6.93B | 20.02 | 24.91% | 1.29% | 4.25% | 29.89% | |
67 Neutral | £2.68B | 23.57 | 20.10% | 2.04% | 3.03% | 13.76% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
62 Neutral | £592.91M | 28.89 | 6.66% | 4.87% | -9.46% | -57.37% | |
62 Neutral | £1.19B | 22.48 | 8.58% | 3.30% | -3.96% | 192.10% |
* Industrials Sector Average
GB:MGAM
Morgan Advanced Materials
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31.06
16.93%
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Morgan Advanced Materials Corporate Events
Business Operations and StrategyExecutive/Board Changes
Morgan Advanced Materials Grants Performance-Linked LTIP Awards to Senior Executives
Positive
Mar 31, 2026
Morgan Advanced Materials has granted a series of conditional long-term incentive plan (LTIP) awards in the form of ordinary shares to several senior executives, including the CEO, CFO and other key PDMRs, under its 2022 share plan. The awards, ma...
Regulatory Filings and Compliance
Morgan Advanced Materials Discloses PDMR Share Vesting and Sale
Neutral
Mar 26, 2026
Morgan Advanced Materials has disclosed a transaction involving Laurent Cohen-Scali, President of Thermal Products and a person discharging managerial responsibilities. He received 56,185 ordinary shares through the vesting of an award under the M...
Financial DisclosuresRegulatory Filings and ComplianceShareholder Meetings
Morgan Advanced Materials Publishes 2025 Annual Report and Sets Date for 2026 AGM
Neutral
Mar 26, 2026
Morgan Advanced Materials has published its Annual Report and Financial Statements for the year ended 31 December 2025, along with the Notice of its 2026 Annual General Meeting and the related proxy form. The documents have been made available to ...
Executive/Board ChangesRegulatory Filings and Compliance
Morgan Advanced Materials Executives Sell Shares After LTIP Vesting
Neutral
Mar 24, 2026
Morgan Advanced Materials has disclosed a series of share transactions by senior executives following the vesting of 15% of their 2023 long-term incentive plan awards under the company’s 2022 share plan. The transactions, all conducted on 23...
Regulatory Filings and Compliance
Morgan Advanced Materials CEO Increases Stake With Share Purchase
Positive
Mar 9, 2026
Morgan Advanced Materials has disclosed that its chief executive, Damien Caby, purchased 14,000 ordinary shares in the company on 5 March 2026 at a price of £2.12 per share on the London Stock Exchange. The transaction, filed under market abu...
Regulatory Filings and Compliance
Morgan Advanced Materials CEO boosts stake with London share purchase
Positive
Mar 5, 2026
Morgan Advanced Materials has disclosed that its chief executive officer, Damien Caby, purchased 14,000 ordinary shares of the company at a price of £2.01 per share on 3 March 2026. The trade, executed on the London Stock Exchange, was report...
Business Operations and StrategyDividendsFinancial DisclosuresM&A Transactions
Morgan Advanced Materials Tightens Portfolio as Earnings Slip in Tough Markets
Neutral
Mar 3, 2026
Morgan Advanced Materials reported a decline in 2025 revenue and profit amid weak semiconductor and European industrial demand, though trading stabilised in the second half of the year. The group maintained its total dividend and delivered stronge...
Stock BuybackRegulatory Filings and Compliance
Morgan Advanced Materials Updates Share Capital Following Buyback Cancellations
Positive
Feb 2, 2026
Morgan Advanced Materials has confirmed that, as of 31 January 2026, its issued share capital consists of 276,676,409 ordinary shares with full voting rights and 437,281 non-voting cumulative preference shares, with no shares held in treasury. The...
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.