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Koppers Holdings Inc. (KOP)
NYSE:KOP
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Koppers Holdings
(NYSE:KOP)
Rating:65Neutral
Price Target:
$29.00
▼( -4.51% Downside)
Positive Factors
Gross Margin Improvement
Q1/25 results benefited from an improvement in gross margin to 23% from 19% in Q1/24 as well as an absolute decline in SG&A expenses of $4 million representing an 8.7% decrease versus Q1/24.
RUPS Segment Growth
The RUPS segment reported sales of $235 million, an increase of 4.4% compared to $225.1 million in Q1/24.
Negative Factors
Market Share Loss
PC saw a 21.5% volume decrease of residential and industrial wood treatment preservatives in the Americas resulting from a market share shift in the U.S. associated with the residential preservative market.
PC Sales Decline
PC sales decreased 19.5% to $120.9 million compared to $150.1 million in Q1/24.
Koppers Holdings (KOP) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$607.71M
Dividend Yield0.95%
Average Volume (3M)166.40K
Price to Earnings (P/E)26.5
Beta (1Y)1.06
Revenue Growth-4.09%
EPS Growth-66.97%
CountryUS
Employees2,082
SectorBasic Materials
Sector Strength64
IndustryChemicals - Specialty
Share Statistics
EPS (TTM)0.71
Shares Outstanding20,010,069
10 Day Avg. Volume191,715
30 Day Avg. Volume166,403
Financial Highlights & Ratios
PEG Ratio-0.35
Price to Book (P/B)1.16
Price to Sales (P/S)0.00
P/FCF Ratio13.60
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$64.00Price Target Upside110.73% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
Koppers Holdings Business Overview & Revenue Model
Company DescriptionKoppers Holdings Inc. is a global integrated provider of treated wood products, wood treatment chemicals, and carbon compounds. The company operates through three main segments: Railroad and Utility Products and Services, Performance Chemicals, and Carbon Materials and Chemicals. Koppers serves various industries, including railroad, aluminum, steel, agriculture, and construction, by providing innovative solutions to enhance the durability and sustainability of infrastructure and industrial applications.
How the Company Makes MoneyKoppers Holdings generates revenue through its three primary segments. The Railroad and Utility Products and Services segment supplies treated wood products, such as crossties and utility poles, to the railroad and utility industries. The Performance Chemicals segment offers wood treatment chemicals that protect against decay and extend the lifespan of wood products, targeting the residential and commercial construction sectors. The Carbon Materials and Chemicals segment produces carbon pitch, creosote, and other products derived from coal tar, serving the aluminum, steel, and other industrial markets. Key revenue streams include long-term contracts with railroad operators and utility companies, as well as partnerships with industrial manufacturers. Koppers' earnings are influenced by factors such as demand for infrastructure development, regulatory requirements for treated wood products, and global economic conditions affecting industrial production.
Koppers Holdings Financial Statement Overview
Summary
Koppers Holdings shows robust revenue growth and strong cash flow generation capabilities. However, the company faces challenges with declining profitability margins and high leverage. Improving efficiency and managing debt will be crucial to enhance financial stability.Income Statement
The company has shown consistent revenue growth over the years, albeit with slight fluctuations. Gross profit margins are strong at 100% due to the nature of the reported data, but net profit margins have shown a decline from previous years, indicating rising costs or operational challenges. EBIT and EBITDA margins have also decreased, suggesting potential efficiency issues or increased operational expenses.68
Positive
Balance Sheet
The balance sheet reveals a high debt-to-equity ratio, reflecting substantial leverage that poses financial risks. While the equity ratio has improved, indicating better asset management, the return on equity has declined, showing a lower efficiency in generating returns from shareholders' equity.60
Neutral
Cash Flow
Operating cash flow remains positive and has improved over the years, indicating strong cash generation capabilities. Free cash flow has shown volatility, but recent growth suggests improved capital management. The operating cash flow to net income ratio is favorable, demonstrating efficient cash conversion.72
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 2.09B | 2.15B | 1.98B | 1.68B | 1.67B | Gross Profit |
| 422.60M | 366.60M | 344.60M | 334.10M | 360.40M | EBIT |
| 148.20M | 195.20M | 137.70M | 156.50M | 156.70M | EBITDA |
| 213.00M | 252.60M | 196.30M | 217.80M | 213.10M | Net Income Common Stockholders |
| 52.40M | 89.20M | 63.40M | 85.20M | 89.10M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 43.90M | 66.50M | 33.30M | 45.50M | 38.50M | Total Assets |
| 1.89B | 1.84B | 1.71B | 1.66B | 1.60B | Total Debt |
| 1.02B | 930.70M | 904.50M | 875.10M | 878.40M | Net Debt |
| 978.00M | 864.20M | 871.20M | 829.60M | 839.90M | Total Liabilities |
| 1.40B | 1.33B | 1.31B | 1.25B | 1.25B | Stockholders Equity |
| 488.70M | 498.90M | 399.40M | 406.60M | 341.70M |
| Cash Flow | Free Cash Flow | |||
| 42.00M | 25.60M | -3.00M | -22.00M | 57.30M | Operating Cash Flow |
| 119.40M | 146.10M | 102.30M | 103.00M | 127.10M | Investing Cash Flow |
| -173.30M | -116.00M | -114.80M | -89.50M | 5.60M | Financing Cash Flow |
| 35.70M | 2.60M | 4.80M | -4.00M | -128.70M |
Koppers Holdings Technical Analysis
Positive
30.37
Price Trends
27.24
Positive
28.82
Positive
32.52
Negative
Market Momentum
1.34
Negative
64.27
Neutral
77.70
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KOP, the sentiment is Positive. The current price of 30.37 is above the 20-day moving average (MA) of 27.88, above the 50-day MA of 27.24, and below the 200-day MA of 32.52, indicating a neutral trend. The MACD of 1.34 indicates Negative momentum. The RSI at 64.27 is Neutral, neither overbought nor oversold. The STOCH value of 77.70 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for KOP.
Koppers Holdings Risk Analysis
Koppers Holdings disclosed 38 risk factors in its most recent earnings report. Koppers Holdings reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Koppers Holdings Peers Comparison
Overall Rating
UnderperformOutperform
Sector (50)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
68 Neutral | $1.24B | 22.38 | 4.65% | 2.77% | -0.16% | 47.70% | |
65 Neutral | $607.71M | 26.52 | 5.08% | 0.95% | -4.09% | -66.97% | |
65 Neutral | $1.86B | 11.37 | -1.45% | 0.72% | -3.82% | -126.04% | |
65 Neutral | $867.59M | 17.67 | -1.64% | ― | 2.23% | -115.70% | |
60 Neutral | $613.34M | 23.91 | 5.55% | 0.74% | -2.31% | -69.16% | |
54 Neutral | $1.51B | ― | -88.14% | ― | -17.68% | -214.32% | |
50 Neutral | $1.99B | -1.06 | -21.34% | 3.71% | 2.03% | -30.65% |
* Basic Materials Sector Average
Performance Comparison
KOP
Koppers Holdings
30.37
-12.23
-28.71%
MTX
Minerals Technologies
58.14
-26.64
-31.42%
SCL
Stepan Company
54.43
-30.53
-35.93%
OEC
Orion Engineered
10.53
-13.88
-56.86%
NGVT
Ingevity
40.89
-6.85
-14.35%
ECVT
Ecovyst
7.30
-2.00
-21.51%
Koppers Holdings Earnings Call Summary
Earnings Call Date:May 09, 2025
(Q1-2025)
| % Change Since: 16.09%|
Next Earnings Date:Jul 31, 2025
Earnings Call Sentiment Neutral
Despite a decline in sales, Koppers reported improved profitability and strong margins through cost reductions and efficiency measures. The company received recognition for its sustainability efforts and improved safety performance. However, challenges such as decreased sales in key segments and broader economic uncertainty remain a concern.Q1-2025 Updates
Positive Updates
Improved Adjusted EBITDA and Margin
Adjusted EBITDA for the first quarter was $55.5 million, up from $51.5 million in the prior year. The overall adjusted EBITDA margin improved to 12.2% from 10.3%, marking the strongest Q1 margin since 2021.
Reduction in SG&A Costs
The company reduced its SG&A costs by $4.1 million compared to Q1 2024, benefiting from a 5% reduction in the global employee base.
Recognition for Sustainability Efforts
Koppers was named to USA Today's list of America's Climate Leaders for the third consecutive year and received a Chemical Safety Excellence Award from CSX.
Strong Safety Performance
31 out of 41 facilities operated accident-free for the quarter, with certain international branches achieving zero recordable incidents.
Positive Developments in CMC Segment
Despite lower sales, the CMC segment reported improved profitability with adjusted EBITDA of $10 million compared to $4 million in the prior year due to cost reductions.
Negative Updates
Sales Decline
Consolidated sales decreased by $41 million or 8% from the prior year quarter, with significant decreases in PC and CM&C segments.
Performance Chemicals Volume Decrease
PC segment sales were down by $29 million or 19.5%, with a 21.5% volume decrease in the Americas due to market share shifts and weather impacts.
Termination of Pension Plan
Cash flow was negatively impacted by a $14 million payment associated with the termination of the U.S. pension plan.
Challenging Economic Conditions
Broader economic uncertainty and high interest rates are impacting business performance, with mixed messages from the customer base regarding demand.
Company Guidance
During Koppers' first quarter 2025 earnings call, the company provided comprehensive guidance while highlighting several key metrics. Despite a decrease in sales from $497.6 million in the prior year to $456.5 million, Koppers achieved an adjusted EBITDA of $55.5 million, up from $51.5 million in the previous year, improving its adjusted EBITDA margin to 12.2% from 10.3%. The company reported a first-quarter diluted loss per share of $0.68, a decline from the $0.59 earnings per share in the prior year, attributed to restructuring charges and pension plan termination losses. However, adjusted earnings per share rose to $0.71 from $0.62. Cash flow used in operations was $22.7 million, including a $14 million pension-related payment, compared to $12.3 million in the prior year. Capital expenditures were reduced to $10 million from $25.8 million. Koppers maintained its 2025 adjusted EBITDA forecast at $280 million and projected sales between $2 billion and $2.2 billion. The company also underscored its commitment to sustainability and safety, with 31 out of 41 facilities operating accident-free in the quarter.Koppers Holdings Corporate Events
Shareholder MeetingsFinancial Disclosures
Koppers Holdings Reports Q1 2025 Financial Results
Negative
May 9, 2025
On May 8, 2025, Koppers Holdings Inc. held its Annual Meeting of Shareholders, where shareholders approved the Amended and Restated 2020 Long Term Incentive Plan and elected eight directors for one-year terms. Additionally, the company reported its first quarter 2025 financial results, showing a decrease in net sales to $456.5 million from $497.6 million in the prior year quarter. Despite a net loss of $13.9 million, adjusted EBITDA increased to $55.5 million, driven by cost reduction measures and improved performance in the RUPS and CMC segments.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.