Newmarket (NEU) AI Stock Analysis

• Market Cap: $7.87B
• Dividend Yield: 1.25%
• Average Volume (3M): 92.15K
• Price to Earnings (P/E): 16.6
• Beta (1Y): 0.56
• Revenue Growth: 2.27%
• EPS Growth: 17.81%
• Country: US
• Employees: 2,060
• Sector: Basic Materials
• Sector Strength: 60
• Industry: Chemicals - Specialty
• EPS (TTM): 11.84
• Shares Outstanding: 9,396,621
• 10 Day Avg. Volume: 91,180
• 30 Day Avg. Volume: 92,152
• PEG Ratio: 0.55
• Price to Book (P/B): 3.46
• Price to Sales (P/S): 1.81
• P/FCF Ratio: 10.93
• Enterprise Value/Market Cap: 0.93
• Enterprise Value/Revenue: 2.63
• Enterprise Value/Gross Profit: 8.05
• Enterprise Value/Ebitda: 9.36
• 1Y Price Target: $873.00
• Price Target Upside: 4.24% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 0

• Rating: 76 Outperform
• Price Target: $873.00 ▲(4.24% Upside)

Newmarket's strong financial performance and positive earnings call sentiment are key strengths, supported by solid profitability and strategic investments. Technical indicators suggest caution due to overbought conditions, and valuation metrics indicate fair pricing. Challenges in specific segments and external factors are notable risks.

Positive Factors

Strong Profitability

High profit margins indicate efficient operations and pricing power, supporting long-term financial stability and shareholder value.

Specialty Materials Segment Growth

Growth in the Specialty Materials segment reflects successful product offerings and market demand, contributing to diversified revenue streams.

Improved Debt Metrics

Improved debt metrics enhance financial flexibility and reduce risk, allowing for strategic investments and resilience against economic fluctuations.

Negative Factors

Decline in Petroleum Additives Segment

Decreased sales in this segment may impact overall revenue and profit growth, highlighting the need for strategic adjustments to counteract declines.

Inflationary and Tariff Challenges

Inflation and tariffs increase costs and pressure margins, potentially affecting pricing strategies and operational efficiency over the medium term.

Slight Decline in Revenue Growth

A decline in revenue growth may signal market saturation or increased competition, necessitating innovation and market expansion efforts.

Newmarket Business Overview & Revenue Model

Company Description

NewMarket Corporation, through its subsidiaries, engages in the petroleum additives business. The company offers lubricant additives for use in various vehicle and industrial applications, including engine oils, transmission fluids, off-road powertrain and hydraulic systems, gear oils, hydraulic oils, turbine oils, and other applications where metal-to-metal moving parts are utilized; engine oil additives designed for passenger cars, motorcycles, on and off-road heavy duty commercial equipment, locomotives, and engines in ocean-going vessels; driveline additives designed for products, such as transmission fluids, axle fluids, and off-road powertrain fluids; and industrial additives designed for products for industrial applications consisting of hydraulic fluids, grease, industrial gear fluids, and industrial specialty applications, such as turbine oils. It also provides fuel additives that are used to enhance the oil refining process and the performance of gasoline, diesel, biofuels, and other fuels to industry, government, original equipment manufacturers, and individual customers. In addition, the company engages in the antiknock compounds business, as well as contracted manufacturing and services activities; and owns and manages a real property in Virginia. It operates in North America, Latin America, the Asia Pacific, Europe, the Middle East, Africa, and India. NewMarket Corporation was founded in 1887 and is headquartered in Richmond, Virginia.

How the Company Makes Money

Newmarket generates revenue primarily through subscription fees for its software solutions, which are offered on a SaaS (Software as a Service) model. This allows clients to access the latest updates and features without the need for significant upfront investment in hardware or software. Additionally, Newmarket earns money through implementation services, training, and ongoing support, creating a robust revenue stream from both new and existing customers. Strategic partnerships with major hotel chains and travel organizations also contribute to its earnings by expanding its market reach and increasing client acquisition.

Newmarket Financial Statement Overview

Summary

Newmarket demonstrates strong profitability with high margins and efficient equity use. Despite a slight decline in revenue growth, the balance sheet is solid with manageable leverage and strong cash flow metrics.

Income Statement

Newmarket has demonstrated strong profitability with a TTM gross profit margin of 32.68% and a net profit margin of 17.28%. The company also shows a robust EBIT margin of 21.78% and an EBITDA margin of 26.54%. Revenue growth, however, is slightly declining from the previous year, indicating potential challenges in maintaining top-line growth.

Balance Sheet

The balance sheet portrays a solid financial position with a debt-to-equity ratio of 0.57, indicating manageable leverage. Return on equity is impressive at 29.79%, reflecting efficient use of equity to generate profits. The equity ratio is strong at 50.45%, providing a stable asset base.

Cash Flow

Cash flow analysis reveals a healthy operating cash flow to net income ratio of 1.21, showcasing efficient cash generation. The free cash flow to net income ratio is commendable at 1.09. Despite a decrease in free cash flow compared to the prior period, the company maintains solid cash flow metrics overall.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.78B	2.79B	2.70B	2.76B	2.36B	2.01B
Gross Profit	908.50M	886.35M	772.51M	640.50M	547.71M	595.03M
EBITDA	781.55M	758.43M	604.33M	465.22M	401.09M	441.62M
Net Income	480.25M	462.41M	388.86M	279.54M	190.91M	270.57M
Balance Sheet
Total Assets	3.19B	3.13B	2.31B	2.41B	2.56B	1.93B
Cash, Cash Equivalents and Short-Term Investments	70.26M	77.48M	111.94M	68.71M	459.22M	125.17M
Total Debt	918.38M	1.06B	733.60M	1.07B	1.21B	660.58M
Total Liabilities	1.58B	1.67B	1.23B	1.64B	1.80B	1.17B
Stockholders Equity	1.61B	1.46B	1.08B	762.41M	762.13M	759.82M
Cash Flow
Free Cash Flow	525.10M	462.27M	528.53M	52.45M	86.40M	190.84M
Operating Cash Flow	583.18M	519.59M	576.82M	108.62M	165.34M	284.15M
Investing Cash Flow	-58.08M	-738.80M	-48.29M	315.89M	-461.41M	-74.24M
Financing Cash Flow	-548.89M	185.81M	-487.59M	-439.36M	255.13M	-231.46M

Newmarket Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 837.51
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NEU, the sentiment is Positive. The current price of 837.51 is above the 20-day moving average (MA) of 812.16, above the 50-day MA of 760.11, and above the 200-day MA of 614.47, indicating a bullish trend. The MACD of 24.58 indicates Positive momentum. The RSI at 67.45 is Neutral, neither overbought nor oversold. The STOCH value of 78.79 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NEU.

Newmarket Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ESI	80 Outperform	$6.36B	26.57	9.62%	1.22%	5.41%	23.44%
NEU	76 Outperform	$7.87B	16.60	33.61%	1.25%	2.27%	17.81%
AXTA	73 Outperform	$6.75B	15.32	22.09%	―	-1.01%	50.58%
EMN	70 Neutral	$7.71B	9.44	14.52%	4.91%	1.60%	-3.97%
AVTR	63 Neutral	$8.39B	12.22	11.73%	―	-2.34%	89.86%
Sector *	61 Neutral	$10.42B	7.39	-0.05%	2.86%	2.86%	-36.73%
ALB	55 Neutral	$8.94B	―	-8.66%	2.13%	-33.05%	-97.63%

Newmarket Corporate Events

NewMarket Announces $2.75 Quarterly Dividend

On August 7, 2025, NewMarket Corporation announced a quarterly dividend of $2.75 per share, payable on October 1, 2025, to shareholders recorded by September 15, 2025. This decision reflects the company’s ongoing commitment to its stakeholders and may impact its financial strategy and market positioning.