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Quaker Chemical (KWR)
NYSE:KWR
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Quaker Chemical
(NYSE:KWR)
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Rating:58Neutral
Price Target:
$144.00
▲(8.12% Upside)
Quaker Chemical's overall stock score reflects a challenging financial performance with declining profitability and cash flow issues. However, positive earnings call highlights, including strong EBITDA growth and effective cost management, provide some optimism. The technical analysis suggests a stable trend, but valuation concerns persist due to a negative P/E ratio.
Positive Factors
Organic Volume Growth
Strong organic volume growth, especially in Asia Pacific, indicates robust demand and effective market penetration, supporting long-term revenue expansion.
Cost Management
Effective cost management improves profitability and operational efficiency, enhancing the company's ability to navigate economic challenges and invest in growth.
Debt Reduction
Reducing debt strengthens the balance sheet, lowers interest expenses, and increases financial flexibility, supporting long-term strategic initiatives.
Negative Factors
Declining Profitability
Negative profitability suggests challenges in cost control and pricing power, potentially hindering reinvestment and shareholder returns if not addressed.
Cash Flow Challenges
Weak cash flow performance limits the company's ability to fund operations and growth initiatives, potentially impacting long-term sustainability.
Macroeconomic Challenges
Persistent macroeconomic challenges and tariff uncertainties can disrupt supply chains and demand, affecting the company's strategic planning and market stability.
Quaker Chemical (KWR) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.59B
Dividend Yield1.37%
Average Volume (3M)132.77K
Price to Earnings (P/E)―
Beta (1Y)1.05
Revenue Growth0.08%
EPS Growth-107.33%
CountryUS
Employees4,400
SectorBasic Materials
Sector Strength58
IndustryChemicals - Specialty
Share Statistics
EPS (TTM)2.08
Shares Outstanding17,340,034
10 Day Avg. Volume151,729
30 Day Avg. Volume132,768
Financial Highlights & Ratios
PEG Ratio5.61
Price to Book (P/B)1.85
Price to Sales (P/S)1.36
P/FCF Ratio11.60
Enterprise Value/Market Cap1.17
Enterprise Value/Revenue1.63
Enterprise Value/Gross Profit4.53
Enterprise Value/Ebitda21.65
Forecast
1Y Price Target
$171.00Price Target Upside28.39% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Quaker Chemical Business Overview & Revenue Model
Company DescriptionQuaker Chemical Corporation (KWR) is a global leader in providing comprehensive chemical solutions to various industries, including metalworking, automotive, aerospace, and general manufacturing. The company specializes in high-performance lubricants, corrosion preventatives, and specialty chemicals designed to enhance production efficiency and product quality. Quaker Chemical operates through its segments, including Metalworking Process Fluids, Corrosion Prevention, and other specialty products, catering to a diverse clientele with tailored solutions that meet specific industrial needs.
How the Company Makes MoneyQuaker Chemical generates revenue primarily through the sale of its chemical products and services to industrial customers across multiple sectors. The company has a diverse revenue model that includes direct sales, long-term contracts, and partnerships with major manufacturers. Key revenue streams arise from the provision of metalworking fluids, industrial lubricants, and specialty chemicals, which are essential for optimizing manufacturing processes and improving equipment performance. Additionally, Quaker Chemical benefits from ongoing relationships with clients, often providing customized solutions and technical support, which fosters customer loyalty and recurring business. Strategic partnerships and acquisitions also play a significant role in expanding its product offerings and market reach, contributing to overall earnings.
Quaker Chemical Earnings Call Summary
Earnings Call Date:Oct 30, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Feb 19, 2026
Earnings Call Sentiment Positive
The earnings call highlights a strong financial performance with growth in adjusted EBITDA and earnings per share, supported by organic volume growth and strategic acquisitions. Despite macroeconomic challenges and end market declines, the company effectively managed costs and reduced debt, contributing to a positive outlook.Q3-2025 Updates
Positive Updates
Strong Financial Performance
Adjusted EBITDA increased by 5% and adjusted earnings per share rose by 10% year-over-year. The company also generated $51 million of operating cash flow in the third quarter.
Organic Volume Growth
The company experienced organic volume growth across all regions, with a notable 8% increase in Asia Pacific.
Net Share Gains
Global net share gains were strong at 5%, driven by new business wins and reduced churn.
Contribution from Acquisitions
Acquisitions, particularly Dipsol, contributed positively to sales and are performing in line with expectations.
Improved Gross Margins
Gross margins improved from the second quarter and are within the targeted range, with adjusted EBITDA margins at 16.8%.
Successful Cost Management
On a year-to-date basis, organic SG&A is down approximately 3%, with continued benefits expected in Q4 and 2026.
Debt Reduction and Shareholder Returns
Outstanding debt was reduced by $62 million, and approximately $62 million was returned to shareholders through dividends and share repurchases.
Negative Updates
Macroeconomic Challenges
Macroeconomic trends remained soft through 2025, with uncertainty around tariffs affecting customer operating plans.
End Market Declines
End market activity was estimated to have declined a low single-digit percentage compared to the prior year, affecting production levels in key sectors like steel and automotive.
Price/Mix Impact
Selling price and product mix were 2% lower than the prior year, affecting the overall revenue growth.
Company Guidance
During the Quaker Houghton Third Quarter 2025 Earnings Conference Call, the company provided guidance that highlighted several key metrics. They reported a strong performance with adjusted EBITDA increasing by 5% and adjusted earnings per share rising by 10% year-over-year. The company achieved a 7% increase in sales, driven by a 3% increase in organic sales volumes and 5% in global new business wins. The Asia Pacific region was a standout, with an 8% increase in organic sales volumes. Quaker Houghton also reduced their net leverage to 2.4x and returned $62 million to shareholders through dividends and share repurchases. Looking ahead, the company expects to deliver revenue and adjusted EBITDA growth in the fourth quarter, despite a softer macroeconomic environment, supported by ongoing share gains and cost management efforts.Quaker Chemical Financial Statement Overview
Summary
Quaker Chemical is facing financial headwinds, with declining profitability and cash flow challenges. While the company maintains a stable capital structure, operational inefficiencies and cash flow issues need to be addressed to improve financial health.Income Statement
Quaker Chemical's income statement shows mixed results. The TTM (Trailing-Twelve-Months) data indicates a slight revenue growth of 1.72%, but the company is currently experiencing a negative net profit margin of -0.48%, indicating a loss. Gross profit margin remains healthy at 35.94%, but the EBIT and EBITDA margins have significantly declined compared to previous years, reflecting operational challenges.Balance Sheet
The balance sheet reveals a moderate debt-to-equity ratio of 0.66, which is manageable but has increased over the years. The return on equity is negative in the TTM period, signaling inefficiencies in generating returns for shareholders. However, the equity ratio remains stable, suggesting a solid capital structure.Cash Flow
Cash flow analysis shows a decrease in free cash flow growth by -16.56% in the TTM period, indicating potential cash management issues. The operating cash flow to net income ratio is below 1, suggesting that cash generation is not keeping pace with earnings. The free cash flow to net income ratio is relatively strong at 0.83, but overall cash flow performance is weak.| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.86B | 1.84B | 1.95B | 1.94B | 1.76B | 1.42B |
| Gross Profit | 670.05M | 686.03M | 705.64M | 612.65M | 594.64M | 513.44M |
| EBITDA | 140.20M | 280.18M | 285.81M | 120.16M | 255.87M | 136.99M |
| Net Income | -9.00M | 116.64M | 112.75M | -15.93M | 121.37M | 39.66M |
Balance Sheet | ||||||
| Total Assets | 2.82B | 2.61B | 2.71B | 2.82B | 2.96B | 2.89B |
| Cash, Cash Equivalents and Short-Term Investments | 172.04M | 188.88M | 194.53M | 180.96M | 165.18M | 181.83M |
| Total Debt | 897.11M | 737.82M | 788.97M | 991.80M | 929.66M | 926.01M |
| Total Liabilities | 1.45B | 1.26B | 1.33B | 1.54B | 1.57B | 1.57B |
| Stockholders Equity | 1.36B | 1.35B | 1.38B | 1.28B | 1.39B | 1.32B |
Cash Flow | ||||||
| Free Cash Flow | 127.53M | 215.86M | 240.22M | 13.26M | 27.48M | 160.49M |
| Operating Cash Flow | 152.97M | 204.58M | 279.02M | 41.79M | 48.93M | 178.39M |
| Investing Cash Flow | -213.60M | -76.42M | -27.62M | -40.19M | -49.13M | -71.39M |
| Financing Cash Flow | 23.61M | -122.66M | -238.61M | 24.67M | -13.46M | -75.25M |
Quaker Chemical Technical Analysis
Positive
133.19
Price Trends
137.21
Positive
136.59
Positive
125.21
Positive
Market Momentum
2.21
Negative
63.51
Neutral
90.94
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KWR, the sentiment is Positive. The current price of 133.19 is below the 20-day moving average (MA) of 142.04, below the 50-day MA of 137.21, and above the 200-day MA of 125.21, indicating a bullish trend. The MACD of 2.21 indicates Negative momentum. The RSI at 63.51 is Neutral, neither overbought nor oversold. The STOCH value of 90.94 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for KWR.
Quaker Chemical Risk Analysis
Quaker Chemical disclosed 30 risk factors in its most recent earnings report. Quaker Chemical 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
Quaker Chemical Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $2.56B | 28.86 | 36.41% | 1.87% | 4.98% | 30.84% | |
64 Neutral | $2.03B | -2,450.75 | -0.09% | 0.74% | -2.53% | -100.23% | |
61 Neutral | $10.43B | 7.12 | -0.05% | 2.87% | 2.86% | -36.73% | |
61 Neutral | $2.74B | -3.28 | -34.45% | 2.79% | -13.67% | -608.89% | |
59 Neutral | $2.29B | -34.89 | -38.91% | ― | -13.39% | 88.25% | |
58 Neutral | $2.59B | -292.80 | -0.64% | 1.37% | 0.08% | -107.33% | |
54 Neutral | $1.98B | -1,360.37 | -0.09% | 2.19% | -4.49% | -100.80% |
* 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.