NPK International (NPKI) AI Stock Analysis

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NPK International

(NYSE:NPKI)

55Neutral

NPK International's overall score reflects challenges in its financial performance, particularly with declining revenue and profitability. Positive earnings call sentiment and reasonable valuation provide some upside. Technical analysis suggests caution with current bearish trends. Corporate events support long-term strategic growth but require successful execution to materialize benefits.

Positive Factors

Business Transformation

The business transformation process is now being executed with a heavy focus on ramping the matting rental segment to meet the healthy customer demand environment.

Financial Performance

Newpark has an improved balance sheet with the debt lowered to $5.5M from approximately $58.0M previously, and cash on hand of $42.9M.

Share Buyback Program

The company has increased its share buyback program to $50M.

Negative Factors

Project Shifts

Certain customers shifting their priorities from scheduled transmission projects to renewable generation projects has impacted revenues.

Revenue Impact

Revenues in the quarter were impacted mainly by certain customers shifting their priorities from scheduled transmission projects to renewable generation projects and unfavorable weather conditions in Southeast United States.

NPK International (NPKI) vs. S&P 500 (SPY)

Market Cap

$502.02M

Dividend YieldN/A

Average Volume (3M)740.71K

Price to Earnings (P/E)11.2

Beta (1Y)0.95

Revenue Growth-39.99%

EPS Growth217.35%

CountryUS

Employees460

SectorEnergy

Sector Strength51

IndustryOil & Gas Equipment & Services

Share Statistics

EPS (TTM)0.52

Shares Outstanding86,554,490

10 Day Avg. Volume742,853

30 Day Avg. Volume740,709

Financial Highlights & Ratios

PEG Ratio0.05

Price to Book (P/B)N/A

Price to Sales (P/S)1.12

Price to Cash Flow (P/CF)-30.40

P/FCF Ratio0.00

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$11.50

Price Target Upside98.28% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering3

NPK International Business Overview & Revenue Model

Company DescriptionNPK International (NPKI) is a leading global supplier in the agricultural industry, specializing in the production and distribution of high-quality fertilizers. The company operates across various sectors, including agriculture, horticulture, and turf management, providing essential nutrients to enhance crop yields and soil health. NPKI's core products include nitrogen, phosphorus, and potassium-based fertilizers, which are critical components for optimal plant growth and sustainability.

How the Company Makes MoneyNPK International makes money primarily through the sale of its fertilizer products to a diverse customer base, including farmers, agricultural enterprises, and retail distributors. The company's revenue model is centered around both direct sales and long-term supply agreements with key agricultural players, ensuring a steady demand for its products. NPKI maintains significant partnerships with global agricultural cooperatives, enabling access to large-scale distribution networks and enhancing its market reach. Additionally, the company invests in research and development to innovate and improve its product offerings, which helps to maintain competitive pricing and attract a loyal customer base. External factors such as global agricultural trends and government regulations on farming practices also play a role in influencing NPKI's earnings.

NPK International Financial Statement Overview

Summary

NPK International's financial performance is marked by declining revenues and profitability challenges, reflected in negative net income and shrinking margins. However, the balance sheet remains strong with low leverage and a high equity ratio, suggesting financial stability. Cash flows are positive but show signs of pressure, with declining free cash flow.

Income Statement

Neutral

NPK International shows a mixed financial performance with declining revenue trends and negative net income in the TTM. Gross profit margin has decreased to 20.77% in TTM from previous levels. The net profit margin is significantly negative at -28.46%, highlighting profitability challenges. Despite a positive EBITDA margin of 10.78%, the company faces pressure due to declining revenue and negative net income.

Balance Sheet

Neutral

The balance sheet reveals a relatively stable equity position with an equity ratio of 81.22% in TTM. The debt-to-equity ratio is low at 0.08, indicating conservative leverage. However, the return on equity is concerning due to negative net income, impacting overall profitability. The company maintains a strong asset base relative to its liabilities, suggesting a solid financial foundation.

Cash Flow

Neutral

Cash flow analysis indicates a positive operating cash flow in TTM, but the free cash flow has declined compared to previous periods. The operating cash flow to net income ratio is not favorable due to negative net income. Free cash flow to net income ratio is also impacted, reflecting challenges in converting income into cash. Despite these issues, the company manages to generate positive cash from operations.

TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Breakdown
Income Statement		Total Revenue
560.14M	749.60M	815.59M	614.78M	492.63M	820.12M
	Gross Profit
116.38M	138.54M	121.54M	85.23M	19.37M	135.38M
	EBIT
36.53M	33.63M	28.29M	-8.82M	-63.91M	21.82M
	EBITDA
60.39M	64.73M	29.19M	32.80M	-36.28M	58.35M
	Net Income Common Stockholders
-159.44M	14.52M	-20.83M	-25.53M	-80.70M	-12.95M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
37.94M	38.59M	23.18M	24.09M	24.20M	48.67M
	Total Assets
640.83M	642.34M	714.88M	752.89M	709.19M	900.08M
	Total Debt
94.92M	92.44M	133.93M	137.16M	112.23M	186.82M
	Net Debt
56.98M	53.84M	110.75M	113.07M	88.03M	138.15M
	Total Liabilities
219.24M	226.97M	291.85M	290.50M	221.16M	351.43M
	Stockholders Equity
421.59M	415.36M	423.03M	462.39M	488.03M	548.64M
Cash Flow		Free Cash Flow
39.42M	70.77M	-53.29M	-24.81M	40.00M	27.48M
	Operating Cash Flow
78.45M	100.00M	-25.02M	-3.01M	55.79M	72.29M
	Investing Cash Flow
15.27M	-5.69M	46.23M	-17.48M	-3.40M	-49.76M
	Financing Cash Flow
-79.70M	-81.05M	-24.93M	21.41M	-77.94M	-29.53M

NPK International Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price5.80

Price Trends

50DMA

5.89

Negative

100DMA

6.68

Negative

200DMA

7.07

Negative

Market Momentum

MACD

-0.05

Negative

RSI

52.56

Neutral

STOCH

87.23

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NPKI, the sentiment is Neutral. The current price of 5.8 is above the 20-day moving average (MA) of 5.54, below the 50-day MA of 5.89, and below the 200-day MA of 7.07, indicating a neutral trend. The MACD of -0.05 indicates Negative momentum. The RSI at 52.56 is Neutral, neither overbought nor oversold. The STOCH value of 87.23 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for NPKI.

NPK International Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RNGR	67 Neutral	$281.68M	15.09	6.74%	1.71%	-10.29%	-14.30%
NESR	67 Neutral	$610.86M	―	1.53%	―	―	―
TTI	65 Neutral	$304.51M	2.82	56.37%	―	-4.34%	312.14%
CLB	61 Neutral	$553.89M	19.32	11.40%	0.34%	1.32%	―
Sector *	55 Neutral	$7.10B	3.56	-6.61%	5.99%	-0.03%	-51.71%
NPKI	55 Neutral	$502.02M	11.15	10.31%	―	-39.99%	217.35%
PUMP	49 Neutral	$515.81M	―	-15.19%	―	-11.42%	-278.57%

* Energy Sector Average

Performance Comparison

NPKI

NPK International

5.80

-1.44

-19.89%

CLB

Core Laboratories

11.86

-5.05

-29.86%

TTI

Tetra Technologies

2.69

-1.82

-40.35%

PUMP

Propetro Holding

5.32

-3.68

-40.89%

RNGR

Ranger Energy Services

12.26

2.22

22.11%

NESR

National Energy Services Reunited

6.40

-2.57

-28.65%

NPK International Earnings Call Summary

Earnings Call Date: Feb 26, 2025 | % Change Since: -8.66% | Next Earnings Date: May 1, 2025

Earnings Call Sentiment Positive

The earnings call highlighted strong revenue and gross margin growth, record product sales, and a successful fleet expansion, indicating a positive performance. However, challenges included a decline in service revenues and currency fluctuations. Despite these issues, the overall sentiment is positive given the strategic growth and financial improvements.

Highlights

Strong Fourth Quarter Performance

Fourth quarter revenue increased 24% year-over-year to $58 million, with rental revenues increasing by 28% year-over-year. Gross margin improved by nearly 500 basis points to 39.2%, and adjusted EBITDA increased by 35% compared to the prior year.

Record Product Sales

Product sales increased by 24% year-over-year to a record $72 million in 2024, driven by the adoption of the DURA-BASE composite matting solution.

Successful Fleet Expansion

In 2024, $33 million was invested in the rental fleet, expanding it by approximately 13% from the end of 2023.

Improved Financial Position

Ended the year with $18 million in cash and $8 million in total debt, resulting in a net cash position of $10 million.

Positive Outlook for 2025

Anticipated total revenues in the $230 million to $250 million range and adjusted EBITDA in the $60 million to $70 million range for 2025.

Lowlights

Decline in Service Revenues

Service revenues declined by 15% year-over-year, impacted by a strategic move away from service-intensive projects.

Seasonal Slowdown Impact

Fourth quarter operating cash flow used $4 million, influenced by the revenue-driven growth in receivables and $12 million in net CapEx.

Currency Fluctuations

Fourth quarter FX loss was $700,000, primarily driven by U.S. dollar to British pound currency fluctuations.

Company Guidance

During the Newpark Resources Fourth Quarter and Full Year 2024 Results Conference Call, the company reported a strong finish to the year with a 24% year-over-year increase in fourth-quarter revenue to $58 million. Rental revenues surged by 28%, setting a new quarterly record. Gross margin improved by nearly 500 basis points to 39.2%, while adjusted EBITDA rose to $17.1 million, marking a 35% increase from the previous year. For the full year, total revenue grew by 5%, driven by a 7% rise in rental revenue and a 24% increase in product sales, despite a 15% decline in service revenues. The company invested $33 million in expanding its rental fleet and ended the year with a net cash position of $10 million. Looking ahead to 2025, Newpark anticipates revenues between $230 million and $250 million and adjusted EBITDA in the range of $60 million to $70 million, with a continued focus on expanding its high-return rental business and optimizing capital allocation.

NPK International Corporate Events

Executive/Board ChangesBusiness Operations and Strategy

NPK International Expands Board with New Appointment

Positive

Mar 11, 2025

On March 10, 2025, NPK International Inc. expanded its Board of Directors by appointing Joseph A. Cutillo as a new member, increasing the board size from seven to eight directors. Mr. Cutillo, with over 30 years of experience in infrastructure and construction projects, is expected to bring valuable insights to NPK’s growth strategy, particularly in scaling businesses within critical infrastructure markets. His appointment aligns with NPK’s goals of transforming its specialty rental and services platform, enhancing shareholder value through strategic execution and operational excellence.

M&A TransactionsBusiness Operations and StrategyFinancial Disclosures

NPK International Sells Fluids Systems Segment

Positive

Feb 27, 2025

On September 13, 2024, NPK International completed the sale of its Fluids Systems segment, which is now reported under discontinued operations. The company reported a 5% year-over-year revenue growth in 2024, with a total revenue of $217 million and an adjusted EBITDA of $55 million, reflecting a 12% growth. NPK International continues to focus on expanding its services in the utilities sector and maintaining its position as a leader in the composite matting industry. The company emphasizes safety, service quality, and environmental sustainability, leveraging its vertically integrated model to support diverse end-markets such as oil & gas, power transmission, and infrastructure construction.

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.