Innospec (IOSP) AI Stock Analysis

• Market Cap: $1.93B
• Dividend Yield: 2.19%
• Average Volume (3M): 269.10K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.02
• Revenue Growth: -4.49%
• EPS Growth: -100.80%
• Country: US
• Employees: 2,450
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Chemicals - Specialty
• EPS (TTM): 1.12
• Shares Outstanding: 24,777,582
• 10 Day Avg. Volume: 276,485
• 30 Day Avg. Volume: 269,103
• PEG Ratio: -1.04
• Price to Book (P/B): 2.27
• Price to Sales (P/S): 1.49
• P/FCF Ratio: 19.18
• Enterprise Value/Market Cap: 0.88
• Enterprise Value/Revenue: 0.95
• Enterprise Value/Gross Profit: 3.40
• Enterprise Value/Ebitda: 9.94
• 1Y Price Target: $93.00
• Price Target Upside: 24.75% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): 5.05
• Revenue Forecast (FY): $1.78B

• Rating: 54 Neutral
• Price Target: $76.00 ▲(1.95% Upside)

Innospec's overall stock score is primarily impacted by its financial performance challenges, including declining revenue and profitability. Technical analysis shows a bearish trend, while valuation reflects poor earnings performance despite a decent dividend yield. The earnings call highlighted mixed results, with strong performance in some segments but significant challenges in others.

Positive Factors

Strong Cash Position

A strong cash position with no debt provides Innospec with significant financial flexibility for strategic investments, M&A, and shareholder returns, supporting long-term growth and stability.

Fuel Specialties Growth

The growth in Fuel Specialties indicates strong demand and effective cost management, contributing positively to Innospec's overall profitability and market position in the energy sector.

Dividend Increase

Increasing dividends reflect confidence in cash flow stability and commitment to returning value to shareholders, enhancing investor appeal and supporting stockholder loyalty.

Negative Factors

Declining Revenue

Declining revenue trends can indicate weakening demand or competitive pressures, which may impact long-term profitability and market share if not addressed effectively.

Performance Chemicals Margin Decline

The decline in margins within Performance Chemicals suggests cost pressures and product mix challenges, which could affect profitability and require strategic adjustments to improve efficiency.

Net Income and EPS Drop

A significant drop in net income and EPS indicates financial strain and potential operational inefficiencies, which may hinder reinvestment capabilities and shareholder returns if not reversed.

Innospec Business Overview & Revenue Model

Company Description

Innospec Inc. (IOSP) is a global specialty chemicals company that operates primarily in the personal care, fuels, and industrial sectors. The company develops and manufactures a range of innovative chemical products, including surfactants, performance chemicals, and additives, which are used in various applications such as personal care formulations, fuel additives, and other industrial processes. With a strong focus on sustainability and innovation, Innospec aims to provide high-quality solutions that meet customer needs across diverse markets.

How the Company Makes Money

Innospec generates revenue primarily through the sale of its specialty chemical products across different segments. The company has key revenue streams from its Personal Care segment, which includes products for skin and hair care; the Fuels segment, which provides fuel additives that enhance performance and reduce emissions; and the Industrial segment, which includes a variety of performance chemicals for different industrial applications. Innospec's revenue model is bolstered by long-term relationships with customers and partnerships with leading brands in the personal care and automotive industries. Additionally, the company invests in research and development to create innovative solutions that meet evolving market demands, further driving its sales and profitability.

Innospec Financial Statement Overview

Summary

Innospec's financial performance is challenged by declining revenue and profitability, with a negative revenue growth rate and net profit margin. The balance sheet is stable with low leverage, but cash flow management needs improvement, particularly in generating free cash flow.

Income Statement

Innospec's income statement shows a declining trend in revenue with a negative revenue growth rate of -8.4% TTM. The gross profit margin is moderate at 28%, but the net profit margin is negative, indicating a loss. EBIT and EBITDA margins are also low, reflecting operational challenges. The company needs to address profitability issues to improve its financial health.

Balance Sheet

The balance sheet is relatively strong with a low debt-to-equity ratio of 0.035, indicating low leverage. However, the return on equity is negative, reflecting the company's recent losses. The equity ratio is healthy, suggesting a stable asset base. Overall, the balance sheet shows financial stability but highlights the need for improved profitability.

Cash Flow

Cash flow analysis reveals a significant decline in free cash flow growth at -44.3% TTM, which is concerning. The operating cash flow to net income ratio is positive, indicating some operational cash generation. However, the free cash flow to net income ratio suggests challenges in converting earnings into cash. The company needs to enhance cash flow management.

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	501.20M	542.90M	591.10M	586.70M	434.90M	342.70M
EBITDA	171.70M	224.60M	200.90M	227.40M	173.00M	87.50M
Net Income	-1.20M	35.60M	139.10M	133.00M	93.10M	28.70M
Balance Sheet
Total Assets	1.80B	1.73B	1.71B	1.60B	1.57B	1.40B
Cash, Cash Equivalents and Short-Term Investments	270.80M	289.20M	203.70M	147.10M	141.80M	105.30M
Total Debt	49.00M	44.90M	45.20M	45.30M	35.60M	40.80M
Total Liabilities	496.50M	518.60M	557.80M	563.30M	537.90M	452.50M
Stockholders Equity	1.30B	1.21B	1.15B	1.04B	1.03B	944.40M
Cash Flow
Free Cash Flow	46.10M	143.10M	145.20M	39.40M	54.10M	116.20M
Operating Cash Flow	102.60M	184.50M	207.30M	81.70M	93.20M	145.90M
Investing Cash Flow	-76.50M	-62.00M	-111.80M	-42.10M	-36.20M	-29.70M
Financing Cash Flow	-61.10M	-35.30M	-39.00M	-33.70M	-20.00M	-86.80M

Innospec Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 74.55
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IOSP, the sentiment is Positive. The current price of 74.55 is below the 20-day moving average (MA) of 75.12, above the 50-day MA of 74.25, and below the 200-day MA of 82.67, indicating a neutral trend. The MACD of 1.28 indicates Negative momentum. The RSI at 66.38 is Neutral, neither overbought nor oversold. The STOCH value of 82.90 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IOSP.

Innospec Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SCL	66 Neutral	$1.09B	24.49	3.67%	3.18%	5.35%	-1.43%
MTX	64 Neutral	$1.93B	-2,320.30	-0.09%	0.73%	-2.53%	-100.23%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
ASH	61 Neutral	$2.68B	-3.27	-34.45%	2.81%	-13.67%	-608.89%
KWR	58 Neutral	$2.38B	-274.52	-0.64%	1.40%	0.08%	-107.33%
NGVT	58 Neutral	$2.06B	-31.87	-38.91%	―	-13.39%	88.25%
IOSP	54 Neutral	$1.93B	-1,342.86	-0.09%	2.19%	-4.49%	-100.80%

Innospec Corporate Events

Innospec Reports Q3 2025 Financial Results and Dividend Increase

Innospec Inc. announced its financial results for the third quarter of 2025, reporting total revenues of $441.9 million, slightly down from $443.4 million the previous year. The company declared a semi-annual dividend of $0.87 per share, marking a 10% increase over 2024, and highlighted strong cash flow generation of $39.3 million from operations. Despite facing lower-than-expected results in some business segments, Innospec remains focused on growth in performance chemicals and oilfield services, with a net cash improvement to $270.8 million.