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Sociedad Quimica Y Minera SA (SQM)
NYSE:SQM
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Sociedad Quimica Y Minera SA
(NYSE:SQM)55Neutral
Positive Factors
Iodine Market
Iodine demand remains strong, growing 7% year-over-year, while supply constraints are likely to push prices up.
Negative Factors
Financial Performance
SQM reported another weaker than expected result with EBITDA 16% below estimates and 12% below consensus, experiencing a 57% decline year-over-year.
Lithium Prices
Lithium prices were lower than expected at US$9.7k/ton, and SQM is guiding for even lower prices in the future.
Sociedad Quimica Y Minera SA (SQM) vs. S&P 500 (SPY)
Market Cap
$10.60B
Dividend Yield3.56%
Average Volume (3M)963.90K
Price to Earnings (P/E)―
Beta (1Y)0.96
Revenue Growth-48.69%
EPS Growth-110.85%
CountryUS
Employees7,682
SectorBasic Materials
Sector Strength56
IndustryChemicals
Share Statistics
EPS (TTM)-1.12
Shares Outstanding142,818,910
10 Day Avg. Volume922,651
30 Day Avg. Volume963,898
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)1.43
Price to Cash Flow (P/CF)N/A
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
$49.00Price Target Upside22.71% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering4
Sociedad Quimica Y Minera SA Business Overview & Revenue Model
Company DescriptionSociedad Quimica y Minera de Chile SA engages in the production & distribution of fertilizers, potassium nitrate, iodine, and lithium chemicals. It operates through the following six segments: Specialty Plant Nutrients, Industrial Chemicals, Iodine & Derivatives, Lithium & Derivatives, Potassium and Other Products & Services. The Specialty Plant Nutrients Segment produces potassium nitrate, sodium nitrate, sodium potassium nitrate and specialty blends. The Industrial Chemicals Segment offers industrial chemicals including sodium nitrate, potassium nitrate and boric acid. The Iodine and Derivatives Segment manufactures iodine and iodine derivatives, which are used in a wide range of medical, pharmaceutical, agricultural and industrial applications. The Lithium and Derivatives Segments covers lithium carbonate for electrochemical materials for batteries; frits for the ceramic and enamel industries; heat-resistant glass; air conditioning chemicals; continuous casting powder for steel extrusion; primary aluminum smelting process; pharmaceuticals; and lithium derivatives. The Potassium Segment produces potassium chloride and potassium sulfate. The Other Products and Services Segment deals with other fertilizers and blends. The company was founded June 17, 1968 and is headquartered in Santiago, Chile.
How the Company Makes MoneySQM generates revenue through the extraction, production, and sale of various chemical products. The company's primary revenue streams include lithium and its derivatives, which are in high demand due to the growing electric vehicle market. Additionally, SQM produces specialty plant nutrients that are used in agriculture to enhance crop yields. The company also benefits from the sale of iodine and its derivatives, which are utilized in medical and industrial applications. Potassium products form another significant part of SQM's revenue, serving as key ingredients in fertilizers. Strategic partnerships with other global companies and a strong presence in markets worldwide further bolster SQM's earnings, as it leverages its expertise in resource extraction and chemical production to meet diverse industry needs.
Sociedad Quimica Y Minera SA Financial Statement Overview
Summary
Sociedad Quimica Y Minera SA is experiencing financial challenges across key areas. The income statement reflects declining revenues and a net loss, while the balance sheet maintains stability through leverage with potential risks from negative profitability. The cash flow statement underscores cash management issues, highlighting the need for strategic improvements to regain financial strength.Income Statement
The company faces significant challenges with a negative net profit margin of -6.74% TTM, indicating a net loss. The revenue growth rate is also negative, reflecting a -36.17% decline from the previous year. The gross profit margin is at 29.93% TTM, but the declining EBIT and EBITDA margins in the TTM period suggest operating difficulties. Overall, the income statement indicates financial pressure and potential profitability issues.45
Neutral
Balance Sheet
The balance sheet shows a moderate debt-to-equity ratio of 0.95 TTM, suggesting a balanced leverage. However, the return on equity is negative due to the net loss, impacting shareholder returns. The equity ratio stands at 45.03% TTM, indicating a reasonable level of equity financing. The balance sheet reflects stability, but profitability challenges are evident.67
Positive
Cash Flow
The cash flow statement highlights issues with free cash flow as it remains negative TTM, marking a decrease from the previous year. The operating cash flow to net income ratio suggests difficulties in converting income into cash. There is a need for improved cash management and cost control to enhance financial health.40
Negative
| Breakdown | |||||
| TTM | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 | Dec 2019 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 4.77B | 7.47B | 10.71B | 2.86B | 1.82B | 1.94B | Gross Profit |
| 1.43B | 3.07B | 5.74B | 1.09B | 482.87M | 560.05M | EBIT |
| 1.23B | 2.89B | 5.53B | 927.29M | 302.50M | 433.65M | EBITDA |
| 1.47B | 3.23B | 5.80B | 1.13B | 516.62M | 660.04M | Net Income Common Stockholders |
| -321.31M | 2.01B | 3.91B | 585.45M | 164.52M | 278.12M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 888.72M | 2.36B | 3.61B | 2.42B | 854.56M | 1.07B | Total Assets |
| 4.37B | 11.71B | 10.82B | 7.04B | 4.82B | 4.68B | Total Debt |
| 1.38B | 4.55B | 2.91B | 2.61B | 1.95B | 1.79B | Net Debt |
| 774.35M | 3.50B | 255.44M | 1.09B | 1.44B | 1.20B | Total Liabilities |
| 2.23B | 6.14B | 5.89B | 3.83B | 2.66B | 2.55B | Stockholders Equity |
| 2.09B | 5.53B | 4.90B | 3.18B | 2.12B | 2.09B |
| Cash Flow | Free Cash Flow | ||||
| -538.80M | -1.28B | 3.00B | 357.80M | -140.01M | 103.16M | Operating Cash Flow |
| 121.86M | -178.29M | 3.91B | 822.52M | 182.23M | 426.97M | Investing Cash Flow |
| -790.28M | -1.48B | -909.40M | -1.01B | -167.09M | -485.47M | Financing Cash Flow |
| 761.25M | 47.91M | -2.00B | 1.21B | -94.13M | 105.90M |
Sociedad Quimica Y Minera SA Technical Analysis
Positive
39.93
Price Trends
38.71
Positive
38.94
Positive
39.72
Positive
Market Momentum
0.03
Positive
54.60
Neutral
38.45
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SQM, the sentiment is Positive. The current price of 39.93 is above the 20-day moving average (MA) of 38.85, above the 50-day MA of 38.71, and above the 200-day MA of 39.72, indicating a bullish trend. The MACD of 0.03 indicates Positive momentum. The RSI at 54.60 is Neutral, neither overbought nor oversold. The STOCH value of 38.45 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SQM.
Sociedad Quimica Y Minera SA Risk Analysis
Sociedad Quimica Y Minera SA disclosed 50 risk factors in its most recent earnings report. Sociedad Quimica Y Minera SA reported the most risks in the “Legal & Regulatory” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Sociedad Quimica Y Minera SA Peers Comparison
Overall Rating
UnderperformOutperform
Sector (47)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $12.76B | 11.17 | 24.43% | 2.66% | -10.48% | -13.78% | |
63 Neutral | $4.57B | 13.50 | 9.02% | 6.34% | -5.36% | -74.25% | |
63 Neutral | $7.31B | 42.32 | 1.47% | 3.64% | -18.79% | -84.24% | |
55 Neutral | $10.60B | ― | -6.32% | 3.56% | -48.69% | -110.85% | |
55 Neutral | $130.98M | ― | -8.43% | 2.64% | -2.35% | -782.69% | |
47 Neutral | $2.64B | -4.00 | -31.55% | 3.33% | 2.93% | -29.90% | |
42 Neutral | $8.48B | ― | -12.18% | 2.23% | -44.08% | -183.44% |
* Basic Materials Sector Average
Performance Comparison
SQM
Sociedad Quimica Y Minera SA
39.93
-6.73
-14.42%
ALB
Albemarle
74.21
-46.57
-38.56%
AVD
American Vanguard
4.75
-6.31
-57.05%
CF
Cf Industries Holdings
76.31
-5.50
-6.72%
FMC
FMC
39.45
-21.44
-35.21%
MOS
Mosaic Co
24.13
-7.08
-22.69%
Sociedad Quimica Y Minera SA Earnings Call Summary
Earnings Call Date: Mar 4, 2025 | % Change Since: 4.07% | Next Earnings Date: May 15, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted significant achievements in lithium sales volumes and iodine segment performance, boosted by strong demand and strategic investments in capacity expansion. However, the positive aspects were balanced by challenges such as a substantial onetime charge impacting net income, a decline in potash production, and increased costs. The outlook for 2025 remains optimistic, particularly for the lithium market.Highlights
Record-Breaking Lithium Sales Volumes
SQM achieved record sales volumes in 2024, reaching nearly 205,000 metric tons of lithium. The fourth quarter alone saw sales surpassing 58,000 metric tons of lithium carbonate equivalent.
Strong Iodine and Plant Nutrition Performance
The Iodine segment had an exceptional year in 2024, achieving record volumes and benefiting from strong price growth driven by the recovery in demand, especially in the X-ray contrast media application.
Significant Investment in Expansion
In 2024, SQM invested over $1.6 billion in expansion, with plans to allocate approximately $750 million for lithium capacity expansion in 2025 and close to $350 million in the caliche operation.
Optimistic Lithium Market Outlook
The lithium market is expected to grow approximately 17% in 2025, with SQM's sales volumes anticipated to grow at a similar rate.
Lowlights
Impact of Onetime Charge on Net Income
Net income for 2024 was impacted by a onetime charge of approximately $1.1 billion due to an ongoing dispute regarding the tax treatment of mining activities.
Decline in Potash Production
Potash production is expected to be down 50% due to a focus on lithium production, which affects primarily the sale of potash.
Higher Cost of Sales
Higher cost of sales was noted in the fourth quarter of 2024, attributed to onetime expenditures allocated in Q4 for specific projects.
Company Guidance
During the SQM Fourth Quarter 2024 Earnings Conference Call, the company's financial guidance highlighted several key metrics and projections. Revenues for the full year 2024 slightly exceeded $4.5 billion, with a gross profit of approximately $1.3 billion. Net income was notably impacted by a one-time charge of $1.1 billion related to a tax dispute. The lithium market saw a 25% growth in 2024, driven by electric vehicle demand, with sales volumes reaching nearly 205,000 metric tons. For 2025, SQM anticipates a demand growth of around 17% for lithium, with sales volumes expected to grow at a similar rate. The iodine segment also had a record year, benefiting from strong price growth. Investment in capacity expansion remains a priority, with over $1.6 billion invested in 2024 and plans to allocate approximately $750 million in 2025 for lithium capacity expansion in Chile and abroad. Additionally, $350 million is planned for the caliche operation to boost iron ore capacity. The company's strong financial position supports these investments and provides flexibility for future opportunities.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.