LSE:ELM

Stock Analysis Report

Executive Summary

Elementis plc manufactures and sells specialty chemicals in North and South America, Europe, and Asia.

Snowflake

Fundamentals

Average dividend payer with imperfect balance sheet.


Similar Companies

Share Price & News

How has Elementis's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

4.1%

ELM

-0.5%

GB Chemicals

0.2%

GB Market


1 Year Return

-22.6%

ELM

-15.5%

GB Chemicals

1.7%

GB Market

Return vs Industry: ELM underperformed the UK Chemicals industry which returned -15.5% over the past year.

Return vs Market: ELM underperformed the UK Market which returned 1.7% over the past year.


Shareholder returns

ELMIndustryMarket
7 Day4.1%-0.5%0.2%
30 Day0.6%-4.9%-1.7%
90 Day14.8%-8.1%-3.1%
1 Year-19.3%-22.6%-12.1%-15.5%6.7%1.7%
3 Year-15.5%-30.6%-4.3%-12.0%17.7%3.1%
5 Year-18.0%-38.3%32.4%11.6%36.1%5.5%

Price Volatility Vs. Market

How volatile is Elementis's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Elementis undervalued compared to its fair value and its price relative to the market?

19.53x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: ELM (£1.55) is trading above our estimate of fair value (£1.38)

Significantly Below Fair Value: ELM is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: ELM is poor value based on its PE Ratio (19.5x) compared to the Chemicals industry average (19.1x).

PE vs Market: ELM is poor value based on its PE Ratio (19.5x) compared to the UK market (16.6x).


Price to Earnings Growth Ratio

PEG Ratio: ELM is poor value based on its PEG Ratio (2x)


Price to Book Ratio

PB vs Industry: ELM is good value based on its PB Ratio (1.3x) compared to the GB Chemicals industry average (2x).


Next Steps

Future Growth

How is Elementis forecast to perform in the next 1 to 3 years based on estimates from 11 analysts?

9.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ELM's forecast earnings growth (9.8% per year) is above the savings rate (1.2%).

Earnings vs Market: ELM's earnings (9.8% per year) are forecast to grow slower than the UK market (12.4% per year).

High Growth Earnings: ELM's earnings are forecast to grow, but not significantly.

Revenue vs Market: ELM's revenue (3.4% per year) is forecast to grow slower than the UK market (3.9% per year).

High Growth Revenue: ELM's revenue (3.4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ELM's Return on Equity is forecast to be low in 3 years time (8.6%).


Next Steps

Past Performance

How has Elementis performed over the past 5 years?

-17.9%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: ELM's earnings have declined by -17.9% per year over the past 5 years.

Accelerating Growth: ELM's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: ELM had negative earnings growth (-44.8%) over the past year, making it difficult to compare to the Chemicals industry average (-3.5%).


Return on Equity

High ROE: ELM's Return on Equity (6.4%) is considered low.


Return on Assets

ROA vs Industry: ELM's Return on Assets is below or equal to the Chemicals industry average last year.


Return on Capital Employed

ROCE Improving: ELM's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is Elementis's financial position?


Financial Position Analysis

Short Term Liabilities: ELM's short term assets ($420.5M) exceeds its short term liabilities ($177.1M)

Long Term Liabilities: ELM's short term assets (420.5M) do not cover its long term liabilities (843.8M)


Debt to Equity History and Analysis

Debt Level: ELM's debt to equity ratio (64.9%) is considered high

Reducing Debt: ELM's debt to equity ratio has increased from 9.3% to 64.9% over the past 5 years.

Debt Coverage: ELM's debt is not well covered by operating cash flow (15.8%).

Interest Coverage: ELM's interest payments on its debt are well covered by EBIT (6.1x coverage).


Balance Sheet

Inventory Level: ELM has a high level of physical assets or inventory.

Debt Coverage by Assets: ELM's debt is not covered by short term assets (assets are 0.7x debt).


Next Steps

Dividend

What is Elementis's current dividend yield, its reliability and sustainability?

4.34%

Current Dividend Yield


Dividend Yield vs Market

company4.3%marketbottom25%2.0%markettop25%5.4%industryaverage3.2%forecastin3Years4.3%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: ELM's dividend (4.34%) is higher than the bottom 25% of dividend payers in the UK market (1.99%).

High Dividend: ELM's dividend (4.34%) is low compared to the top 25% of dividend payers in the UK market (5.37%).

Stable Dividend: ELM's dividend payments have been volatile in the past 10 years.

Growing Dividend: ELM's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: At its current payout ratio (83.3%), ELM's payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: ELM's dividends in 3 years are forecast to be covered by earnings (51.6% payout ratio).


Next Steps

Management

What is the CEO of Elementis's salary, the management and board of directors tenure and is there insider trading?

2.9yrs

Average management tenure


CEO

Paul Waterman (55yo)

3.7yrs

Tenure

US$1,229,000

Compensation

Mr. Paul Waterman has been the Group Chief Executive Officer and Executive Director of Elementis plc since February 8, 2016. Mr. Waterman served as Global Chief Executive Officer of Lubricants at BP p.l.c. ...


CEO Compensation Analysis

Compensation vs. Market: Paul's total compensation ($USD1.58M) is above average for companies of similar size in the UK market ($USD1.19M).

Compensation vs Earnings: Paul's compensation has been consistent with company performance over the past year.


Management Age and Tenure

2.9yrs

Average Tenure

55yo

Average Age

Experienced Management: ELM's management team is considered experienced (2.9 years average tenure).


Board Age and Tenure

4.3yrs

Average Tenure

56.5yo

Average Age

Experienced Board: ELM's board of directors are considered experienced (4.3 years average tenure).


Insider Trading

Insider Buying: ELM insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyUS$10,44615 Aug 19
Paul Waterman
EntityIndividual
Role
Chief Executive Officer
Group Chief Executive Officer & Executive Director
Shares7,500
Max PriceUS$1.39
BuyUS$13,98106 Jun 19
Ralph Hewins
EntityIndividual
Role
Member of the Board of Directors
Group Chief Financial Officer & Executive Director
Shares10,000
Max PriceUS$1.40
BuyUS$9,38306 Jun 19
Paul Waterman
EntityIndividual
Role
Chief Executive Officer
Group Chief Executive Officer & Executive Director
Shares6,500
Max PriceUS$1.44
BuyUS$4,01015 Mar 19
Paul Waterman
EntityIndividual
Role
Chief Executive Officer
Group Chief Executive Officer & Executive Director
Shares2,500
Max PriceUS$1.60
BuyUS$10,17229 Oct 18
Nicholas Salmon
EntityIndividual
Role
Lead Director
Senior Independent Director
Shares5,000
Max PriceUS$2.03

Ownership Breakdown


Management Team

  • Ralph Hewins (55yo)

    Group Chief Financial Officer & Executive Director

    • Tenure: 3.1yrs
    • Compensation: US$614.00k
  • Paul Waterman (55yo)

    Group Chief Executive Officer & Executive Director

    • Tenure: 3.7yrs
    • Compensation: US$1.23m
  • Mark Su

    Managing Director of China Region

    • Tenure: 0yrs
  • Walker Allen

    General Counsel & Chief Compliance Officer

    • Tenure: 20.8yrs
  • Chris Shepherd (54yo)

    Chief Human Resources Officer

    • Tenure: 1.9yrs
  • Christian Kather

    Vice President of Talc

    • Tenure: 0yrs
  • Laura Higgins

    Company Secretary

    • Tenure: 1.8yrs
  • James Curran

    Director of Investor Relations

    • Tenure: 0yrs

Board Members

  • Nick Salmon (66yo)

    Senior Independent Director

    • Tenure: 4.8yrs
    • Compensation: US$57.00k
  • Andy Duff (60yo)

    Non-Executive Chairman

    • Tenure: 5.5yrs
    • Compensation: US$185.00k
  • Anne Hyland (58yo)

    Non-Executive Director

    • Tenure: 6.3yrs
    • Compensation: US$57.00k
  • Steve Good (58yo)

    Non-Executive Director

    • Tenure: 5yrs
    • Compensation: US$57.00k
  • Ralph Hewins (55yo)

    Group Chief Financial Officer & Executive Director

    • Tenure: 3.1yrs
    • Compensation: US$614.00k
  • Paul Waterman (55yo)

    Group Chief Executive Officer & Executive Director

    • Tenure: 3.7yrs
    • Compensation: US$1.23m
  • Sandy Boss (52yo)

    Non-Executive Director

    • Tenure: 2.7yrs
    • Compensation: US$49.00k
  • Dorothée Deuring (51yo)

    Non-Executive Director

    • Tenure: 2.6yrs
    • Compensation: US$49.00k

Company Information

Elementis plc's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Elementis plc
  • Ticker: ELM
  • Exchange: LSE
  • Founded: 1844
  • Industry: Specialty Chemicals
  • Sector: Materials
  • Market Cap: UK£897.685m
  • Shares outstanding: 579.53m
  • Website: https://www.elementisplc.com

Number of Employees


Location

  • Elementis plc
  • Caroline House
  • 55 - 57 High Holborn
  • London
  • Greater London
  • WC1V 6DX
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
EMNS.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 1992
ELMLSE (London Stock Exchange)YesOrdinary SharesGBGBPJan 1992
E3EDB (Deutsche Boerse AG)YesOrdinary SharesDEEURJan 1992
ELMLBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPJan 1992
ELMT.YOTCPK (Pink Sheets LLC)UNSPONSORD ADRUSUSDJul 2013

Biography

Elementis plc manufactures and sells specialty chemicals in North and South America, Europe, and Asia. It operates through Specialty Products and Chromium segments. The Specialty Products segment offers fu ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/21 20:38
End of Day Share Price2019/10/21 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.