Innospec (IOSP) AI Stock Analysis

• Market Cap: $2.22B
• Dividend Yield: 1.9%
• Average Volume (3M): 173.84K
• Price to Earnings (P/E): 83.9
• Beta (1Y): 0.99
• Revenue Growth: -7.91%
• EPS Growth: -81.73%
• Country: US
• Employees: 2,450
• Sector: Basic Materials
• Sector Strength: 68
• Industry: Chemicals - Specialty
• EPS (TTM): 1.42
• Shares Outstanding: 24,960,000
• 10 Day Avg. Volume: 199,701
• 30 Day Avg. Volume: 173,837
• PEG Ratio: 5.14
• Price to Book (P/B): 2.67
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 23.54
• Enterprise Value/Market Cap: 1.13
• Enterprise Value/Revenue: 0.34
• Enterprise Value/Gross Profit: 4.88
• Enterprise Value/Ebitda: 2.84
• 1Y Price Target: $115.00
• Price Target Upside: 31.91% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 63 Neutral
• Price Target: $93.00 ▲(6.68%Upside)

Innospec's overall stock score is driven by its solid financial performance and positive corporate events, which indicate confidence in its financial stability. However, technical analysis and valuation concerns, including a high P/E ratio and mixed momentum indicators, suggest caution. The company should address revenue and cash flow declines to bolster its long-term growth prospects.

Innospec Business Overview & Revenue Model

Company Description

Innospec Inc. develops, manufactures, blends, markets, and supplies specialty chemicals in the United States, rest of North America, the United Kingdom, rest of Europe, and internationally. The company's Fuel Specialties segment offers a range of specialty chemical products that are used as additives in various fuels. This segment's products are used in the operation of automotive, marine, and aviation engines; power station generators; and heating oil. Its Performance Chemicals segment provides technology-based solutions for its customers' processes or products that focuses on the personal care, home care, agrochemical, and metal extraction markets. The company's Oilfield Services segment develops and markets chemical solutions for fracturing, stimulation, and completion operations; and products for oil and gas production, as well as products to prevent loss of mud in drilling operations. It sells its products primarily to oil and gas exploration and production companies, oil refineries, fuel manufacturers and users, personal care and home care companies, formulators of agrochemical and metal extraction formulations, and other chemical and industrial companies. The company was formerly known as Octel Corp. and changed its name to Innospec Inc. in January 2006. Innospec Inc. was founded in 1938 and is headquartered in Englewood, Colorado.

How the Company Makes Money

Innospec generates revenue through the sale of its chemical products and services across its three main business segments. The Fuel Specialties segment provides fuel additives to improve fuel performance and meet regulatory standards, catering primarily to refineries and distributors. The Performance Chemicals segment offers a variety of products used in personal care, home care, and industrial applications, with customers ranging from consumer goods companies to industrial manufacturers. The Oilfield Services segment supplies chemicals and services to the oil and gas industry, focusing on enhancing oilfield operations and production efficiency. Innospec's revenue is driven by its ability to deliver innovative and effective solutions, maintain strong customer relationships, and adapt to changing market demands. Additionally, strategic partnerships and collaborations with key industry players contribute to its earnings.

Innospec Financial Statement Overview

Summary

Innospec demonstrates strong profitability and a stable balance sheet with low leverage. However, recent revenue and free cash flow declines could pose challenges if not addressed.

Income Statement

Innospec's income statement reflects strong gross and net profit margins, indicating robust profitability. The gross profit margin for TTM is approximately 28.7%, and the net profit margin is around 1.5%. Revenue has shown fluctuations, with a TTM decline compared to the preceding year, but overall revenue growth has been positive over the longer term. EBIT and EBITDA margins are healthy, demonstrating efficient cost management. However, the recent revenue decline may pose a risk if the trend continues.

Balance Sheet

The company maintains a solid balance sheet with a low debt-to-equity ratio of 0.04 for TTM, highlighting low leverage. Return on Equity (ROE) is moderate at 2.1% for TTM, indicating average returns on shareholder investments. The equity ratio stands at 71.0%, showcasing a strong equity base relative to total assets. The financial structure is stable, but moderate ROE suggests room for improvement in utilizing equity to generate profits.

Cash Flow

Innospec's cash flow analysis presents a mixed picture. The operating cash flow to net income ratio is strong at 4.9 for TTM, indicating effective cash generation from operations. However, free cash flow has decreased in the latest period, with a noted decline in free cash flow growth rate. While the company maintains a healthy cash position, the decrease in free cash flow may impact future investment capabilities.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
1.79B	1.85B	1.95B	1.96B	1.48B	1.19B
	Gross Profit
512.30M	542.90M	591.10M	586.70M	434.90M	342.70M
	EBIT
170.50M	177.90M	161.60M	187.30M	132.10M	82.60M
	EBITDA
201.50M	224.60M	200.90M	187.30M	182.10M	92.20M
	Net Income Common Stockholders
27.00M	35.60M	139.10M	133.00M	93.10M	28.70M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
147.50M	289.20M	203.70M	147.10M	141.80M	105.30M
	Total Assets
1.62B	1.73B	1.71B	1.60B	1.57B	1.40B
	Total Debt
49.00M	44.90M	45.20M	45.30M	35.60M	40.80M
	Net Debt
-98.50M	-244.30M	-158.50M	-101.80M	-106.20M	-64.50M
	Total Liabilities
543.50M	518.60M	557.80M	563.30M	537.90M	452.50M
	Stockholders Equity
1.08B	1.21B	1.15B	1.04B	1.03B	944.90M
Cash Flow		Free Cash Flow
75.60M	143.10M	130.10M	39.40M	54.10M	116.20M
	Operating Cash Flow
131.90M	184.50M	207.30M	81.70M	93.20M	145.90M
	Investing Cash Flow
-63.40M	-62.00M	-111.80M	-42.10M	-36.20M	-29.70M
	Financing Cash Flow
-39.40M	-35.30M	-39.00M	-33.70M	-20.00M	-86.80M

Innospec Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 87.18
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IOSP, the sentiment is Negative. The current price of 87.18 is above the 20-day moving average (MA) of 86.79, below the 50-day MA of 87.68, and below the 200-day MA of 103.64, indicating a neutral trend. The MACD of -0.41 indicates Negative momentum. The RSI at 48.52 is Neutral, neither overbought nor oversold. The STOCH value of 74.98 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IOSP.

Innospec Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HWKN	76 Outperform	$2.81B	33.48	19.47%	0.53%	6.01%	12.38%
KWR	71 Outperform	$2.12B	22.78	6.78%	1.62%	-5.72%	-19.82%
IOSP	63 Neutral	$2.22B	83.91	2.21%	1.90%	-7.91%	-81.73%
OLN	62 Neutral	$2.52B	43.21	2.94%	3.67%	-1.13%	-81.74%
SSL	53 Neutral	$3.06B	―	-28.05%	2.00%	-4.31%	-1421.83%
Sector *	51 Neutral	$2.04B	-1.21	-21.10%	3.95%	2.90%	-30.45%
ASH	48 Neutral	$2.43B	21.03	-3.02%	3.12%	-7.63%	-157.37%

Innospec Corporate Events

Innospec Shareholders Approve Directors and Compensation

At the annual meeting of Innospec shareholders on May 9, 2025, three Class III directors were elected, and the advisory approval of the company’s executive compensation was passed. Additionally, the appointment of the company’s independent registered public accounting firm for 2025 was ratified, indicating shareholder support for the company’s leadership and financial oversight.

The most recent analyst rating on (IOSP) stock is a Buy with a $115.00 price target. To see the full list of analyst forecasts on Innospec stock, see the IOSP Stock Forecast page.

Innospec Announces Dividend Increase and Share Buyback

Innospec Inc. reported its first quarter 2025 financial results, highlighting a balanced performance amidst market volatility. The company experienced excellent growth in Fuel Specialties, which offset lower results in Performance Chemicals and Oilfield Services. Total revenues decreased by 12% compared to the previous year, with net income also declining. Despite these challenges, Innospec declared a 10% increase in its semi-annual dividend and initiated a $50 million share buyback, reflecting confidence in its financial stability. The company remains focused on delivering full-year operating income growth and margin improvement, although uncertainties related to tariff policies may delay progress in some areas.