Sociedad Quimica Y Minera SA (SQM) AI Stock Analysis

• Market Cap: $12.70B
• Dividend Yield: 0.47%
• Average Volume (3M): 1.80M
• Price to Earnings (P/E): 27.3
• Beta (1Y): 0.74
• Revenue Growth: -23.20%
• EPS Growth: 1226.72%
• Country: US
• Employees: 8,344
• Sector: Basic Materials
• Sector Strength: 65
• Industry: Chemicals - Specialty
• EPS (TTM): 0.31
• Shares Outstanding: 142,818,910
• 10 Day Avg. Volume: 1,471,987
• 30 Day Avg. Volume: 1,795,738
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.00
• Enterprise Value/Revenue: 2.99
• Enterprise Value/Gross Profit: 11.16
• Enterprise Value/Ebitda: 13.48
• 1Y Price Target: $46.36
• Price Target Upside: -1.24% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7

• Rating: 65 Neutral
• Price Target: $50.00 ▲(6.52% Upside)

The overall stock score of 65 reflects a balanced view of SQM's current position. The most significant factor is the mixed financial performance, with stable profitability but liquidity concerns. Technical analysis shows a positive trend, providing some optimism. However, the valuation suggests caution due to a high P/E ratio and no dividend yield. The earnings call adds a cautiously optimistic outlook, but it does not significantly alter the score due to its exclusion from the weighted calculation.

Positive Factors

Earnings

Lithium price rally has triggered upward earnings revision and short covering for SQM stock.

Market Conditions

The suspension of CATL's Jianxiawo lithium lepidolite mine could drive a significant destocking of lithium in China ahead of the peak battery demand season.

Strategic Deals

The potential completion of the deal with Codelco and the stabilization of the lithium market are key to removing uncertainties around SQM and driving the shares.

Negative Factors

Financial Performance

Revenues were 6% below expectations due to lower than expected lithium prices and volumes.

Political Risks

The leading candidates running for president in Chile have publicly opposed the deal between Codelco and SQM, mainly alleging lack of transparency.

Valuation Concerns

SQM's relative valuation to peers is unattractive, and the stock is pricing in lithium well above spot levels in 2026.

Sociedad Quimica Y Minera SA Business Overview & Revenue Model

Company Description

Sociedad Química y Minera de Chile S.A. produces and distributes specialty plant nutrients, iodine and its derivatives, lithium and its derivatives, potassium chloride and sulfate, industrial chemicals, and other products and services. The company offers specialty plant nutrients, including potassium nitrate, sodium nitrate, sodium potassium nitrate, specialty blends, and other specialty fertilizers. It also provides iodine and its derivatives for use in medical, pharmaceutical, agricultural, and industrial applications comprising x-ray contrast media, polarizing films for LCD and LED, antiseptics, biocides and disinfectants, pharmaceutical synthesis, electronics, pigments, and dye components. In addition, the company offers lithium carbonates for various applications that include 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, as well as ingredient in manufacturing of gunpowder. Further, it supplies lithium hydroxide for the lubricating greases industry, as well as cathodes for batteries. Additionally, it offers potassium chloride and potassium sulfate for various crops, including corn, rice, sugar, soybean, and wheat; industrial chemicals, including sodium nitrate, potassium nitrate, potassium chloride, and solar salts; and other fertilizers and blends. The company operates in Chile, Latin America and the Caribbean, Europe, North America, Asia, and internationally. Sociedad Química y Minera de Chile S.A. was incorporated in 1968 and is headquartered in Santiago, Chile.

How the Company Makes Money

SQM generates revenue through multiple key streams, primarily by selling its specialty fertilizers and lithium products. The demand for lithium, driven by the growth of electric vehicles and renewable energy storage, has become a significant revenue driver for the company. Additionally, SQM earns income from the sale of iodine and potassium nitrate, which are utilized in diverse applications ranging from agriculture to pharmaceuticals. The company has established strategic partnerships with major players in the automotive and technology sectors, enhancing its market position and contributing to its earnings. Furthermore, SQM benefits from its efficient production processes and low-cost operations in the lithium and potassium markets, allowing it to maintain competitive pricing while maximizing profitability.

Sociedad Quimica Y Minera SA Financial Statement Overview

Summary

Sociedad Quimica Y Minera SA showcases solid operational margins and a strong balance sheet with moderate leverage. Despite recent revenue and profit declines, the company maintains healthy cash flow and profitability ratios. Continued focus on improving revenue growth and net income will be essential for sustaining financial strength.

Income Statement

The company shows a strong gross profit margin of 28.12% and an EBIT margin of 22.25% for TTM, indicating good operational efficiency. However, the revenue growth rate is negative compared to previous periods, and net profit margin is reduced at 13.45% due to a decline in net income. EBITDA margin remains healthy at 24.13%, demonstrating stable earnings before non-cash items.

Balance Sheet

The balance sheet reflects a stable equity ratio of 45.73%, suggesting a solid financial base. The debt-to-equity ratio is moderate at 0.90, indicating manageable leverage. Return on equity is strong at 11.47%, showing effective use of equity to generate profits, although a reduction from past years.

Cash Flow

Operating cash flow to net income ratio is positive at 2.22, indicating sound cash generation capability relative to net income. However, free cash flow growth is modest with a TTM increase, and free cash flow to net income ratio is at 0.60, reflecting limited cash available for expansion or dividends.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	4.23B	4.53B	7.47B	10.71B	2.86B	1.82B
Gross Profit	1.13B	1.33B	3.07B	5.74B	1.09B	482.87M
EBITDA	937.44M	1.17B	3.23B	5.80B	1.13B	516.62M
Net Income	477.51M	-404.36M	2.01B	3.91B	585.45M	164.52M
Balance Sheet
Total Assets	11.52B	11.50B	11.71B	10.82B	7.04B	4.82B
Cash, Cash Equivalents and Short-Term Investments	2.23B	2.44B	2.36B	3.61B	2.42B	854.56M
Total Debt	4.74B	4.82B	4.55B	2.91B	2.61B	1.95B
Total Liabilities	6.13B	6.30B	6.14B	5.89B	3.83B	2.66B
Stockholders Equity	5.35B	5.16B	5.53B	4.90B	3.18B	2.12B
Cash Flow
Free Cash Flow	-75.40M	302.89M	-1.28B	3.00B	357.80M	-140.01M
Operating Cash Flow	889.64M	1.27B	-178.29M	3.91B	822.52M	182.23M
Investing Cash Flow	-537.36M	-1.21B	-1.48B	-909.40M	-1.01B	-167.09M
Financing Cash Flow	189.19M	282.38M	47.91M	-2.00B	1.21B	-94.13M

Sociedad Quimica Y Minera SA Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 46.94
• 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 SQM, the sentiment is Positive. The current price of 46.94 is above the 20-day moving average (MA) of 42.87, above the 50-day MA of 39.33, and above the 200-day MA of 38.00, indicating a bullish trend. The MACD of 2.21 indicates Negative momentum. The RSI at 65.44 is Neutral, neither overbought nor oversold. The STOCH value of 77.71 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 Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SQM	65 Neutral	$12.70B	27.30	9.29%	0.47%	-23.20%	1226.72%
EMN	65 Neutral	$7.84B	9.62	14.52%	4.79%	1.60%	-3.97%
DD	64 Neutral	$32.22B	40.24	0.31%	2.03%	4.55%	-130.25%
AVTR	64 Neutral	$9.07B	13.21	11.73%	―	-2.34%	89.86%
PPG	63 Neutral	$25.41B	19.88	16.88%	2.45%	-10.59%	-7.79%
Sector *	61 Neutral	$10.31B	6.18	0.76%	2.94%	3.30%	-36.34%
ALB	61 Neutral	$9.59B	―	-8.66%	1.85%	-33.05%	-97.63%