Norsk Hydro (NHYDY) AI Stock Analysis

• Market Cap: $15.89B
• Dividend Yield: 2.82%
• Average Volume (3M): 10.54K
• Price to Earnings (P/E): 15.8
• Beta (1Y): 0.70
• Revenue Growth: 13.03%
• EPS Growth: 699.85%
• Country: US
• Employees: 32,614
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Aluminum
• EPS (TTM): 0.10
• Shares Outstanding: 1,978,489,100
• 10 Day Avg. Volume: 25,559
• 30 Day Avg. Volume: 10,541
• PEG Ratio: 0.34
• Price to Book (P/B): 1.23
• Price to Sales (P/S): 0.61
• P/FCF Ratio: 69.08
• Enterprise Value/Market Cap: 9.99
• Enterprise Value/Revenue: 0.74
• Enterprise Value/Gross Profit: 1.97
• Enterprise Value/Ebitda: 4.78
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 79 Outperform
• Price Target: $8.50 ▲(21.95% Upside)

Norsk Hydro's strong financial performance and bullish technical indicators are the primary drivers of its stock score. While valuation is reasonable, challenges in cash flow and market conditions from the earnings call slightly temper the outlook.

Positive Factors

Revenue Growth

The significant revenue growth reflects strong demand for Norsk Hydro's products, indicating a solid market position and potential for continued expansion.

Long-term Power Contract

Securing a long-term power contract ensures stable and competitive energy costs, enhancing operational efficiency and profitability over the long term.

Partnerships in Low-Carbon Aluminum

Strategic partnerships in low-carbon aluminum strengthen Norsk Hydro's position in sustainable markets, aligning with industry trends towards eco-friendly solutions.

Negative Factors

Challenging Market Conditions

Challenging market conditions impacting EBITDA suggest potential volatility in earnings, which could affect financial stability and growth prospects.

Workforce Reductions

Workforce reductions may lead to short-term cost savings but could impact employee morale and operational capacity, affecting long-term performance.

Pressure on Extrusions and Recycling Margins

Margin pressures in key segments highlight competitive challenges and cost management issues, potentially affecting profitability and market competitiveness.

Norsk Hydro Business Overview & Revenue Model

Company Description

Norsk Hydro ASA engages in the power production, bauxite extraction, alumina refining, aluminium smelting, remelting, and recycling activities; and provision of extruded solutions worldwide. It operates through Bauxite & Alumina, Aluminium Metal, Metal Markets, Extrusions, and Energy segments. The Bauxite & Alumina segment engages in bauxite mining activities, production of alumina, and related commercial activities, primarily the sale of alumina. The Aluminium Metal segment is involved in the primary aluminum production casting activities. This segment principally offers extrusion ingots, foundry alloys, and sheet and standard ingots. The Metal Markets segment sells products from the company's primary metal plants; operates recyclers; and trades in physical and financial metals. The Extrusions segment offers extrusion profiles, building systems, and precision tubing products for construction, automotive and heating, and ventilation and air conditioning sectors, as well as operates recycling facilities. The Energy segment engages in the trading and wholesale business in Brazil; energy sourcing operations; and operation of power stations in Norway, as well as renewable energy production, such as wind and solar, battery, and hydrogen. Norsk Hydro ASA was founded in 1905 and is headquartered in Oslo, Norway.

How the Company Makes Money

Norsk Hydro generates revenue primarily through the production and sale of aluminum products, which includes bauxite, alumina, and various aluminum extrusions and rolled products. The company's revenue model relies on the global demand for aluminum, with significant sales to sectors that require lightweight and durable materials. Key revenue streams include the sale of primary aluminum, which is heavily influenced by market prices and demand from industries such as automotive and construction. Additionally, Norsk Hydro benefits from long-term contracts with major customers, which provide stability in revenue generation. The company also engages in trading activities to optimize its supply chain and capitalize on market opportunities. Partnerships with other industry players and investments in renewable energy further enhance its operational efficiency and profitability.

Norsk Hydro Financial Statement Overview

Summary

Norsk Hydro shows strong revenue growth and profitability with a stable balance sheet. However, challenges in cash flow management and slight margin pressures need attention.

Income Statement

Norsk Hydro's income statement shows strong revenue growth with a 21.2% increase in TTM, indicating robust demand. The gross profit margin of 26.05% and net profit margin of 4.47% suggest healthy profitability, though slightly lower than previous years. EBIT and EBITDA margins are solid at 9.86% and 15.19%, respectively, reflecting efficient operations. However, the decline in gross profit margin from the previous year highlights potential cost pressures.

Balance Sheet

The balance sheet is stable with a low debt-to-equity ratio of 0.38, indicating prudent financial management. The return on equity (ROE) is 9.54%, showing effective use of equity to generate profits. The equity ratio stands at 49.47%, reflecting a strong equity base. However, the slight increase in debt levels compared to equity requires monitoring.

Cash Flow

Cash flow analysis reveals a mixed picture. Operating cash flow to net income ratio is 0.56, indicating good cash generation relative to net income. However, free cash flow growth is negative at -2.44%, suggesting challenges in maintaining cash reserves. The free cash flow to net income ratio of 0.45 is moderate, showing room for improvement in cash flow efficiency.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	215.81B	203.63B	193.62B	207.93B	149.65B	138.12B
Gross Profit	80.73B	74.29B	70.08B	78.56B	52.97B	53.53B
EBITDA	33.20B	22.19B	18.27B	42.33B	27.50B	15.07B
Net Income	10.99B	5.79B	3.58B	24.15B	12.16B	1.84B
Balance Sheet
Total Assets	205.46B	207.37B	206.46B	198.62B	174.51B	164.41B
Cash, Cash Equivalents and Short-Term Investments	23.98B	16.77B	26.48B	31.70B	26.57B	21.25B
Total Debt	37.00B	11.00M	954.00M	32.77B	28.42B	29.56B
Total Liabilities	96.41B	99.92B	99.28B	90.82B	86.13B	86.96B
Stockholders Equity	101.66B	101.46B	100.58B	102.45B	84.06B	74.28B
Cash Flow
Free Cash Flow	10.03B	1.80B	8.58B	19.79B	4.66B	7.23B
Operating Cash Flow	21.92B	15.36B	22.22B	29.39B	10.68B	13.52B
Investing Cash Flow	-16.66B	-12.92B	-20.76B	-10.56B	-4.68B	-8.32B
Financing Cash Flow	-9.05B	-12.56B	-6.70B	-13.25B	-4.37B	1.07B

Norsk Hydro Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 6.97
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NHYDY, the sentiment is Positive. The current price of 6.97 is below the 20-day moving average (MA) of 7.84, below the 50-day MA of 7.39, and above the 200-day MA of 6.35, indicating a bullish trend. The MACD of 0.22 indicates Negative momentum. The RSI at 67.60 is Neutral, neither overbought nor oversold. The STOCH value of 74.50 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NHYDY.

Norsk Hydro Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NHYDY	79 Outperform	$15.89B	15.79	10.48%	2.82%	13.03%	699.85%
AA	70 Outperform	$17.01B	14.85	19.77%	0.75%	20.08%	―
KALU	69 Neutral	$2.06B	22.83	12.41%	2.64%	7.69%	91.86%
CSTM	62 Neutral	$2.87B	27.24	12.22%	―	8.48%	12.10%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
MP	61 Neutral	$11.58B	-90.89	-6.83%	―	26.44%	-95.87%
CENX	56 Neutral	$4.39B	58.03	12.22%	―	20.15%	-72.89%