Victrex (VCT) AI Stock Analysis

• Market Cap: £680.15M
• Dividend Yield: 7.62%
• Average Volume (3M): 154.63K
• Price to Earnings (P/E): 22.9
• Beta (1Y): 1.14
• Revenue Growth: 4.75%
• EPS Growth: -3.29%
• Country: UK
• Employees: 1,131
• Sector: Basic Materials
• Sector Strength: 64
• Industry: Chemicals - Specialty
• EPS (TTM): 0.22
• Shares Outstanding: 87,052,110
• 10 Day Avg. Volume: 323,503
• 30 Day Avg. Volume: 154,629
• PEG Ratio: -1.07
• Price to Book (P/B): 1.71
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 15.45
• 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: £977.14
• Price Target Upside: 24.95% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7

• Rating: 70 Outperform
• Price Target: 894.00p ▲( 14.32% Upside)

Victrex's overall stock score reflects a strong financial position with robust cash flow management but faces challenges in revenue growth and profitability. While technical indicators show a weak trend, the company benefits from positive corporate events and earnings call insights. However, significant improvements in operational performance and market conditions are needed to enhance the stock's appeal.

Positive Factors

Cyclical Recovery

Victrex is seen as an attractive cyclical recovery story, and valuation is attractive.

Valuation

Valuation is compelling, with the stock trading at 10-year lows.

Volume Guidance

Mgmt today upgrades FY25F volume guidance to high single-digit growth as a result of the volume strength in 1H25.

Negative Factors

Earnings Downgrade

Victrex's interims are below JEFe, and contain a c15% implied downgrade to FY25F cons/JEFe PBT, despite good momentum in volumes continuing into the 2Q and upgraded volume guidance for the year.

Medical Recovery

The lack of Medical recovery is exacerbating the drag on the company.

Profitability Challenges

There continues to be very few signs of a Medical recovery, and when this mix headwind is combined with FX & China ramp-up costs, profitability continues to be challenging.

Victrex Business Overview & Revenue Model

Company Description

Victrex plc is a UK-based multinational company that specializes in the manufacture of high-performance polymers. It operates primarily in the industrial, automotive, electronics, energy, and medical sectors. The company is renowned for its production of PEEK (Polyether Ether Ketone), a high-strength, heat-resistant plastic used in a variety of demanding applications. As a leader in polymer manufacturing, Victrex offers innovative solutions that enhance product performance and sustainability across multiple industries.

How the Company Makes Money

Victrex makes money primarily through the production and sale of its high-performance polymer products. The key revenue streams for the company include sales of PEEK and other related polymers to various industries such as aerospace, automotive, electronics, energy, and medical. Victrex generates revenue by supplying these materials to manufacturers who utilize them in products that require durability, lightweight, and resistance to extreme conditions. The company also collaborates with partners to develop customized polymer solutions, enhancing its market position and expanding its applications. Additionally, Victrex's focus on innovation and sustainability helps maintain its competitive edge, contributing to its financial success.

Victrex Financial Statement Overview

Summary

Victrex shows strong balance sheet stability with low leverage and a high equity ratio. However, it faces challenges in revenue and margin declines impacting profitability. Cash flow performance remains robust, reflecting effective financial operations.

Income Statement

The income statement indicates decreasing revenue over the past three years, with a decline from £341M in 2022 to £296.2M in 2024. Gross profit margin reduced from 51.2% to 45.3%, and net profit margin decreased from 17.6% to 5.8%. Despite the declines, the EBIT and EBITDA margins in 2024 are approximately 15.5% and 16.4%, respectively. The company needs to address the decreasing revenue and margins.

Balance Sheet

The balance sheet remains strong with an equity ratio of 77.9% and a debt-to-equity ratio of 0.11, indicating lower leverage and high equity stability. However, the return on equity (ROE) declined from 15.6% in 2022 to 3.7% in 2024, suggesting challenges in profitability. Overall, the company's financial position is stable with low debt levels.

Cash Flow

Operating cash flow increased significantly in 2024 to £84M from £40.8M in 2023, and free cash flow rose to £51.4M. The operating cash flow to net income ratio is robust at 4.88, indicating strong cash generation relative to net income. The free cash flow to net income ratio is 3.0, showing effective cash utilization. Despite challenges in net income, cash flow management remains effective.

Breakdown
Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Income Statement		Total Revenue
296.20M	307.00M	341.00M	306.30M	266.00M
	Gross Profit
134.30M	162.60M	174.70M	157.00M	141.10M
	EBIT
45.80M	73.20M	99.40M	88.40M	76.60M
	EBITDA
69.70M	96.00M	110.60M	110.30M	85.00M
	Net Income Common Stockholders
17.20M	61.70M	76.20M	73.20M	54.20M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
29.30M	33.50M	68.80M	112.40M	73.10M
	Total Assets
592.00M	626.60M	641.60M	615.30M	549.50M
	Total Debt
50.40M	50.20M	32.10M	15.90M	7.10M
	Net Debt
21.10M	16.80M	-26.60M	-59.00M	-66.00M
	Total Liabilities
130.40M	125.60M	151.00M	103.60M	68.50M
	Stockholders Equity
461.00M	499.00M	488.80M	509.20M	478.10M
Cash Flow		Free Cash Flow
51.40M	2.30M	34.50M	85.20M	44.50M
	Operating Cash Flow
84.00M	40.80M	80.00M	127.10M	69.40M
	Investing Cash Flow
-35.40M	-32.30M	-16.20M	-83.20M	-29.50M
	Financing Cash Flow
-51.90M	-32.80M	-82.40M	-41.70M	-38.70M

Victrex Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 782.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:VCT, the sentiment is Negative. The current price of 782 is below the 20-day moving average (MA) of 834.95, below the 50-day MA of 854.06, and below the 200-day MA of 915.84, indicating a bearish trend. The MACD of -15.44 indicates Positive momentum. The RSI at 39.11 is Neutral, neither overbought nor oversold. The STOCH value of 12.53 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:VCT.

Victrex Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TET	72 Outperform	£167.69M	15.18	8.02%	3.00%	1.12%	-0.70%
VCT	70 Outperform	£680.15M	22.90	6.65%	7.62%	4.75%	-3.29%
JMAT	68 Neutral	£2.89B	8.16	15.96%	4.45%	-15.51%	200.70%
CRDA	66 Neutral	£4.26B	26.88	6.84%	3.60%	-3.92%	-7.30%
ELM	56 Neutral	£768.96M	―	-5.93%	1.93%	0.71%	-274.39%
Sector *	50 Neutral	$1.99B	-1.06	-21.34%	3.71%	2.03%	-30.65%
SYNT	46 Neutral	£162.74M	―	-6.25%	―	0.81%	15.63%

Victrex Corporate Events

Victrex Director Increases Stake with Share Purchase

Victrex plc announced that David Thomas, a Non-Executive Director, purchased 1,158 ordinary shares at £8.46 each on the London Stock Exchange. This transaction reflects confidence in the company’s strategic direction and potential for growth, reinforcing its position as a leader in innovative polymer solutions.

The most recent analyst rating on (GB:VCT) stock is a Hold with a £1491.00 price target. To see the full list of analyst forecasts on Victrex stock, see the GB:VCT Stock Forecast page.

Victrex Sees Strong Volume Growth Amid Operational Challenges

Victrex reported a 16% increase in sales volumes for the first half of 2025, driven by strong performance in its Sustainable Solutions segment, despite challenges in the medical sector and currency headwinds. The company has upgraded its full-year volume guidance to high-single-digit growth, supported by operational improvements and strategic initiatives like Project Vista. However, underlying profit before tax was impacted by foreign exchange, sales mix, and operational challenges in China. Victrex remains focused on driving profitability and growth through cost control and enhanced market strategies, while also achieving a major milestone with its ‘Magma’ mega-programme in the energy industry.

Victrex’s ‘Magma’ Programme Advances with TechnipFMC Contract

Victrex plc has announced a significant advancement in its ‘Magma’ mega-programme through a technological contract awarded to TechnipFMC by Petrobras in Brazil. This development involves the use of Victrex’s PEEK polymer in TechnipFMC’s hybrid flexible pipe, which offers a lighter, corrosion-resistant solution with sustainability benefits. This milestone is expected to accelerate the commercialization of this technology, enhancing Victrex’s position in the energy industry and providing new solutions for oil and gas fields.

Victrex PLC Updates Share Capital and Voting Rights

Victrex PLC has announced that as of April 30, 2025, its issued share capital comprises 87,052,107 ordinary shares, each carrying one vote, with no shares held in treasury. This update is crucial for shareholders to determine their notification requirements regarding their interests in the company, reflecting Victrex’s commitment to transparency and regulatory compliance.

Victrex PLC Updates Share Capital and Voting Rights

Victrex PLC announced that as of 31 March 2025, its issued share capital consists of 87,052,107 ordinary shares, each carrying one vote, with no shares held in treasury. This update is significant for shareholders as it provides the denominator for calculating their interest in the company, impacting how they manage and report their shareholdings.

Victrex Director Purchases Shares, Signaling Confidence in Company

Victrex plc announced that Urmi Prasad Richardson, a Non-Executive Director, purchased 100 ordinary shares of the company at £9.58 per share. This transaction, conducted on the London Stock Exchange, reflects managerial confidence in the company’s strategic direction and market positioning. Such insider transactions can be indicative of positive expectations for the company’s future performance and may influence stakeholder perceptions.

Victrex PLC Announces Share Capital and Voting Rights Update

Victrex PLC, a company operating in the advanced materials industry, has announced its current share capital and voting rights status. As of February 28, 2025, the company has an issued share capital of 87,034,903 ordinary shares, each carrying one vote, with no shares held in treasury. This update is crucial for shareholders to calculate their interests or changes in their interests in the company.