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Johnson Matthey (JMPLY)
:JMPLY
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Johnson Matthey
(OTC:JMPLY)
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Rating:74Outperform
Price Target:
$63.00
▲(11.78% Upside)
Johnson Matthey's stock score is driven by a positive earnings call and strong valuation metrics. Technical indicators support a bullish outlook, while financial performance shows areas for improvement. Strategic divestments and future cash flow commitments enhance the investment case.
Johnson Matthey (JMPLY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$4.82B
Dividend Yield3.51%
Average Volume (3M)1.54K
Price to Earnings (P/E)10.7
Beta (1Y)0.63
Revenue Growth-7.72%
EPS Growth247.15%
CountryUS
Employees11,685
SectorBasic Materials
Sector Strength58
IndustryChemicals - Specialty
Share Statistics
EPS (TTM)2.47
Shares Outstanding84,027,880
10 Day Avg. Volume1,156
30 Day Avg. Volume1,542
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)0.00
Price to Sales (P/S)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap0.79
Enterprise Value/Revenue0.33
Enterprise Value/Gross Profit4.25
Enterprise Value/Ebitda7.43
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
Johnson Matthey Business Overview & Revenue Model
Company DescriptionJohnson Matthey (JMPLY) is a global leader in sustainable technologies, specializing in the development of advanced materials and processes that contribute to cleaner air, improved health, and enhanced energy efficiency. The company operates primarily in sectors such as catalyst technology, precious metals, and specialty chemicals, offering a range of products and services that include automotive catalysts, battery materials, and fine chemicals. With a strong focus on innovation and environmental sustainability, Johnson Matthey aims to drive the transition to a low-carbon economy.
How the Company Makes MoneyJohnson Matthey generates revenue through several key streams, primarily by providing catalyst solutions for the automotive and industrial sectors, which help reduce harmful emissions. The company earns significant income from the sale of precious metals, particularly platinum, palladium, and rhodium, which are essential for catalytic converters. Additionally, JMPLY provides specialty chemicals and materials for pharmaceutical and industrial applications, contributing to its revenue. Partnerships with automotive manufacturers and technological collaborations enhance its market reach and innovation capabilities, further bolstering its financial performance. The company's commitment to sustainability and investment in R&D also play crucial roles in driving future growth and profitability.
Johnson Matthey Earnings Call Summary
Earnings Call Date:May 22, 2025
(Q4-2025)
| % Change Since: |
Next Earnings Date:Nov 26, 2025
Earnings Call Sentiment Positive
The earnings call reflects a positive outlook driven by strategic divestments and operational improvements, particularly in the Clean Air and PGM segments. Despite challenges in the hydrogen market and automotive sector, the company is well-positioned for future growth and enhanced shareholder returns.Q4-2025 Updates
Positive Updates
Catalyst Technologies Sale to Honeywell
Johnson Matthey announced the sale of its Catalyst Technologies business to Honeywell for £1.8 billion, representing about 80% of the market cap for less than 20% of the business. This is a significant valuation uplift compared to three years ago.
Clean Air Segment Performance
Clean Air's operating margin improved from 8% three years ago to 11.8%, with expectations to reach mid-teens by the end of the current fiscal year and 16%-18% by 2027-2028. The company has already won 90% of the business needed to meet its 2027-2028 sales target of over £2 billion.
Platinum Group Metals (PGM) Segment Outlook
A new world-class refinery is expected to be commissioned by the end of 2026-2027, which will significantly enhance cash generation and efficiency. The PGM segment is projected to achieve £450 million in sales with a 30% margin by 2027-2028.
Financial Performance and Cash Generation
Free cash flow improved by £400 million in the second half of the fiscal year. The company plans to return £1.4 billion to shareholders from the Catalyst Technologies sale proceeds and commit to delivering £200 million in cash returns annually from 2026-2027 onwards.
Negative Updates
Hydrogen Market Challenges
The hydrogen business segment faced market destocking and a loss of profitability, leading to a significant asset impairment. The company remains committed to the segment but acknowledges delays in market growth.
Automotive Market Headwinds
The Clean Air segment experienced an 8% sales decline due to global automotive production challenges. This has been a consistent issue, affecting the profitability of the segment.
Projected Short-term Impact on PGMS
During the transition to the new refinery, the PGM segment is expected to face a short-term impact due to dual running costs and lower metal recoveries.
Company Guidance
In the recent call, Johnson Matthey outlined significant financial guidance and strategic shifts. The company's sale of Catalyst Technologies to Honeywell for £1.8 billion was a highlight, with net proceeds of £1.6 billion, of which £1.4 billion will be returned to shareholders—equating to £8 per share. The sale represents about 80% of the market cap for less than 20% of the business, indicating a compelling valuation. Johnson Matthey committed to a sustainable free cash flow of at least £250 million and annual shareholder returns of £200 million from 2026-2027 onwards. Clean Air's margin is expected to rise to 16-18% by 2027-2028, from 11.8% currently. The new PGM refinery, crucial for cash flow improvement, is on track for commissioning by late 2026. The company aims for mid-single-digit CAGR in operating profit by 2027-2028, driven by cost reductions, working capital improvements, and reduced CapEx post-refinery completion.Johnson Matthey Financial Statement Overview
Summary
Johnson Matthey's financial performance is characterized by stable operational efficiency but inconsistent profitability and fluctuating cash flows. The balance sheet remains strong, though high liabilities pose risks.Income Statement
Johnson Matthey has shown fluctuating revenue trends with a declining trajectory in recent years. The gross profit margin has remained relatively stable, indicating cost controls, but net profit margin has varied significantly, reflecting volatility in net income. While EBIT and EBITDA margins indicate reasonable operational efficiency, the overall profitability is inconsistent due to variable net income.60
Neutral
Balance Sheet
The balance sheet of Johnson Matthey shows a stable equity base, with a consistent debt-to-equity ratio over the years, indicating manageable leverage. The equity ratio is healthy, reflecting a strong asset base funded by equity. However, there are concerns regarding the relatively high total liabilities, which could pose risks if not managed effectively.65
Positive
Cash Flow
The company's cash flow situation displays some instability, with free cash flow fluctuating and declining recently. Operating cash flow to net income ratio suggests effective cash generation from operations, but variability in free cash flow indicates potential challenges in managing capital expenditures and other cash needs.58
Neutral
| Breakdown | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 11.67B | 12.84B | 14.93B | 16.02B | 15.44B |
| Gross Profit | 899.00M | 898.00M | 989.00M | 1.05B | 944.00M |
| EBITDA | 802.00M | 488.00M | 621.00M | 467.00M | 564.00M |
| Net Income | 373.00M | 108.00M | 276.00M | -101.00M | 205.00M |
Balance Sheet | |||||
| Total Assets | 6.19B | 6.34B | 7.03B | 6.67B | 7.74B |
| Cash, Cash Equivalents and Short-Term Investments | 898.00M | 542.00M | 697.00M | 418.00M | 625.00M |
| Total Debt | 1.70B | 1.49B | 1.67B | 1.25B | 1.38B |
| Total Liabilities | 3.90B | 3.96B | 4.49B | 4.22B | 5.06B |
| Stockholders Equity | 2.29B | 2.38B | 2.54B | 2.44B | 2.69B |
Cash Flow | |||||
| Free Cash Flow | 8.00M | 224.00M | -91.00M | 73.00M | 295.00M |
| Operating Cash Flow | 381.00M | 592.00M | 225.00M | 526.00M | 676.00M |
| Investing Cash Flow | 297.00M | -255.00M | -129.00M | -292.00M | -357.00M |
| Financing Cash Flow | -333.00M | -439.00M | 191.00M | -439.00M | -43.00M |
Johnson Matthey Technical Analysis
Positive
56.36
Price Trends
53.77
Positive
51.06
Positive
43.08
Positive
Market Momentum
1.21
Positive
65.48
Neutral
64.83
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JMPLY, the sentiment is Positive. The current price of 56.36 is below the 20-day moving average (MA) of 56.52, above the 50-day MA of 53.77, and above the 200-day MA of 43.08, indicating a bullish trend. The MACD of 1.21 indicates Positive momentum. The RSI at 65.48 is Neutral, neither overbought nor oversold. The STOCH value of 64.83 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JMPLY.
Johnson Matthey Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
| ― | $4.98B | 33.96 | 12.06% | 0.56% | 7.55% | 22.43% | |
| ― | $4.82B | 10.70 | 16.05% | 3.51% | -7.72% | 247.15% | |
| ― | $7.01B | 8.90 | 14.52% | 5.24% | 1.60% | -3.97% | |
| ― | $3.68B | 9.28 | 29.03% | 2.48% | -3.61% | -9.70% | |
| ― | $4.00B | 10.78 | 4.56% | ― | -6.73% | ― | |
| ― | $3.82B | 29.76 | 12.18% | 1.74% | 4.95% | 53.63% | |
| ― | $10.43B | 7.12 | -0.05% | 2.87% | 2.86% | -36.73% |
* Basic Materials Sector Average
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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.