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Johnson Matthey PLC (JMPLY)
OTHER OTC:JMPLY
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Johnson Matthey
(OTC:JMPLY)
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Rating:64Neutral
Price Target:
$66.00
▲(30.33% Upside)
Action:DowngradedDate:11/21/25
Johnson Matthey's overall stock score is driven by strong earnings call insights and reasonable valuation, despite technical weaknesses and financial performance challenges. The company's strategic initiatives and cash flow improvements are promising, but technical indicators suggest caution.
Positive Factors
Sale of Catalyst Technologies
A confirmed sale that will return GBP 1.4bn is a structural capital event: it crystallizes value, reduces exposure to an underperforming segment, and materially boosts balance sheet flexibility. This improves capacity for buybacks, debt reduction, or reinvestment into battery materials and PGM refining.
Strong operating performance
A 38% uplift in underlying operating performance, led by 33% PGM and 11% Clean Air gains, indicates durable operational improvement and segment diversification. Sustained higher PGM and Clean Air performance supports margins and cash generation even as cyclical markets normalize.
Stable balance sheet
A healthy equity ratio and consistent debt-to-equity imply manageable leverage, enabling the company to fund capital projects (like the Royston refinery) and absorb industry cyclicality. This structural strength underpins creditworthiness and strategic optionality over the medium term.
Negative Factors
Declining revenue trend
A multiyear declining revenue trajectory threatens scale advantages and limits margin expansion. Even with pockets of strength (PGM, Clean Air), persistent top-line weakness reduces operating leverage, constrains reinvestment capacity, and raises execution risk for growth initiatives like battery materials.
Free cash flow volatility
Volatile and recently declining free cash flow undermines predictable capital allocation. It increases reliance on asset disposals or external financing for capex and shareholder returns, and complicates achieving the stated GBP 250m run-rate free cash flow target without sustained operational improvement.
Higher net debt / liabilities
An increase in net debt and relatively high total liabilities reduces financial flexibility. Elevated leverage can amplify downside in cyclical metals and auto markets, constrain funding for strategic projects, and may require further asset sales or slower capital deployment to repair balance sheet metrics.
Johnson Matthey (JMPLY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$4.26B
Dividend Yield3.48%
Average Volume (3M)795.00
Price to Earnings (P/E)―
Beta (1Y)0.59
Revenue Growth-1.77%
EPS Growth-126.50%
CountryUS
Employees11,685
SectorBasic Materials
Sector Strength58
IndustryChemicals - Specialty
Share Statistics
EPS (TTM)1.34
Shares Outstanding84,027,880
10 Day Avg. Volume473
30 Day Avg. Volume795
Financial Highlights & Ratios
PEG Ratio0.02
Price to Book (P/B)1.01
Price to Sales (P/S)0.20
P/FCF Ratio289.61
Enterprise Value/Market Cap0.97
Enterprise Value/Revenue0.36
Enterprise Value/Gross Profit5.18
Enterprise Value/Ebitda7.73
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)3.42
Revenue Forecast (FY)$3.86B
Johnson Matthey Business Overview & Revenue Model
Company DescriptionJohnson Matthey (JMPLY) is a global leader in sustainable technologies, specializing in catalysis, precious metals, and battery materials. The company operates across several sectors, including automotive, pharmaceuticals, chemical processing, and energy, providing innovative solutions that enable cleaner air and reduced environmental impact. Core products include catalysts for emissions control, precious metal refining services, and materials for electric vehicle batteries, positioning JMPLY at the forefront of the transition to a low-carbon economy.
How the Company Makes MoneyJohnson Matthey generates revenue through several key streams. The largest portion comes from its Catalysis segment, where it produces catalysts used in automotive emissions control and industrial processes. The company also earns significant revenue from its Precious Metal Products division, which includes refining services and trading in precious metals like platinum, palladium, and rhodium. Additionally, JMPLY has a growing revenue stream from its Battery Materials segment, which supplies advanced materials for lithium-ion batteries used in electric vehicles and energy storage. Strategic partnerships with automotive manufacturers and investment in innovative technologies further enhance its revenue potential, as does the global shift towards sustainability and regulatory pressures for lower emissions, driving demand for its products and services.
Johnson Matthey Earnings Call Summary
Earnings Call Date:Nov 20, 2025
(Q2-2026)
| % Change Since: |
Next Earnings Date:May 21, 2026
Earnings Call Sentiment Positive
The earnings call reflected a strong financial performance with significant improvements in operating profit and cash flow. Key strategic moves, such as the sale of Catalyst Technologies, are on track. However, there are challenges, including delays in the new refinery and weaker performance in Catalyst Technologies, though these are being managed effectively.Q2-2026 Updates
Positive Updates
Strong Operating Performance
The underlying operating performance increased by 38%, with an 11% increase in Clean Air and a 33% increase in Platinum Group Metals.
Cash Flow Turnaround
Johnson Matthey achieved a significant turnaround in cash flow, moving from a significant cash outflow last year to a small inflow, with more improvements expected in the future.
Sale of Catalyst Technologies On Track
The sale of Catalyst Technologies to Honeywell is on track to close in the first half of 2026, with GBP 1.4 billion to be returned to shareholders upon closure.
Strong Performance in Platinum Group Metals
Platinum Group Metals Services reported a 33% increase in underlying operating profit, supported by higher metal prices and improved efficiencies.
Clean Air Margin Improvement
A 200 basis point increase in the margin for Clean Air was achieved, keeping the company on track for a 14% to 15% margin by the end of the fiscal year.
Positive Customer and Employee Feedback
The Net Promoter Score increased by 15 points, and employee engagement improved, indicating positive customer and employee sentiment.
Negative Updates
Delays in New Refinery Project
A small delay of a few months has occurred in the new PGM refinery project, though it is not expected to impact guidance or customer delivery.
Weaker Performance in Catalyst Technologies
The Catalyst Technologies segment experienced a significantly weaker performance compared to the prior year, attributed to market conditions.
Increased Net Debt
Net debt increased due to cash outflows from Catalyst Technologies, dividend payments, and significant stock build in the U.S. refinery.
Company Guidance
In the recent investor call, Johnson Matthey provided comprehensive guidance for the upcoming periods. The company reported a robust 38% increase in underlying operating performance, with significant contributions from a 33% rise in Platinum Group Metals and an 11% growth in Clean Air. They also achieved a notable turnaround in cash flow, moving from a significant outflow last year to a small inflow this period, and they anticipate more improvements in the second half and subsequent years. The sale of Catalyst Technologies to Honeywell is progressing as planned, expected to close in the first half of 2026, with GBP 1.4 billion to be returned to shareholders upon completion. Clean Air's margin improved by 200 basis points, aligning with their target of a 14% to 15% margin by the end of the fiscal year, and they aim for a 16% to 18% margin by 2027-2028. The new PGM refinery at Royston, a GBP 350 million investment, is on track for commissioning by March 2026 despite a small delay. Furthermore, the company is on course to achieve a run-rate breakeven for Hydrogen Technologies by March 2026, and they reaffirmed their goal of generating GBP 250 million in consistent free cash flow moving forward.Johnson Matthey Financial Statement Overview
Summary
Johnson Matthey's financial performance shows stability in operational efficiency but faces challenges with fluctuating net income and cash flows. The balance sheet is strong, yet high liabilities and inconsistent profitability are concerns.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 | TTM | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 11.38B | 11.67B | 12.84B | 14.93B | 16.02B | 15.44B |
| Gross Profit | 801.26M | 899.00M | 898.00M | 989.00M | 1.05B | 944.00M |
| EBITDA | 536.43M | 802.00M | 488.00M | 621.00M | 467.00M | 564.00M |
| Net Income | -129.00M | 373.00M | 108.00M | 276.00M | -101.00M | 205.00M |
Balance Sheet | ||||||
| Total Assets | 5.83B | 6.19B | 6.34B | 7.03B | 6.67B | 7.74B |
| Cash, Cash Equivalents and Short-Term Investments | 547.00M | 898.00M | 542.00M | 697.00M | 418.00M | 625.00M |
| Total Debt | 1.49B | 1.70B | 1.49B | 1.67B | 1.25B | 1.38B |
| Total Liabilities | 3.73B | 3.90B | 3.96B | 4.49B | 4.22B | 5.06B |
| Stockholders Equity | 2.10B | 2.29B | 2.38B | 2.54B | 2.44B | 2.69B |
Cash Flow | ||||||
| Free Cash Flow | 244.98M | 8.00M | 224.00M | -91.00M | 73.00M | 295.00M |
| Operating Cash Flow | 520.72M | 381.00M | 592.00M | 225.00M | 526.00M | 676.00M |
| Investing Cash Flow | -306.00M | 297.00M | -255.00M | -129.00M | -292.00M | -357.00M |
| Financing Cash Flow | -264.00M | -333.00M | -439.00M | 191.00M | -439.00M | -43.00M |
Johnson Matthey Technical Analysis
Negative
50.64
Price Trends
59.92
Negative
57.53
Negative
53.60
Negative
Market Momentum
-2.61
Positive
31.20
Neutral
22.51
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JMPLY, the sentiment is Negative. The current price of 50.64 is below the 20-day moving average (MA) of 55.10, below the 50-day MA of 59.92, and below the 200-day MA of 53.60, indicating a bearish trend. The MACD of -2.61 indicates Positive momentum. The RSI at 31.20 is Neutral, neither overbought nor oversold. The STOCH value of 22.51 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative 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 |
|---|---|---|---|---|---|---|---|
81 Outperform | $5.41B | 32.29 | 12.31% | 0.61% | 7.55% | 22.43% | |
74 Outperform | $3.63B | 11.96 | 20.42% | 2.72% | -7.04% | -11.28% | |
68 Neutral | $7.90B | 15.45 | 8.09% | 5.33% | -3.33% | -19.59% | |
67 Neutral | $7.26B | 76.21 | 1.59% | ― | -6.73% | ― | |
65 Neutral | $3.79B | 29.50 | 11.63% | 1.70% | 4.25% | 56.51% | |
64 Neutral | $4.26B | -47.18 | -5.87% | 3.48% | -1.77% | -126.50% | |
61 Neutral | $10.43B | 7.12 | -0.05% | 2.87% | 2.86% | -36.73% |
* Basic Materials Sector Average
JMPLY
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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.