NYSE:FOE

Stock Analysis Report

Executive Summary

Ferro Corporation produces specialty materials in the United States and internationally.

Rewards

Trading at 38% below its fair value

Earnings are forecast to grow 17.71% per year

Risk Analysis

Debt is not well covered by operating cash flow

Large one-off items impacting financial results



Snowflake Analysis

Moderate growth potential and slightly overvalued.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: FOE has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

1.7%

FOE

1.6%

US Chemicals

1.5%

US Market


1 Year Return

-15.8%

FOE

-3.7%

US Chemicals

20.1%

US Market

Return vs Industry: FOE underperformed the US Chemicals industry which returned -3.7% over the past year.

Return vs Market: FOE underperformed the US Market which returned 20.1% over the past year.


Shareholder returns

FOEIndustryMarket
7 Day1.7%1.6%1.5%
30 Day-2.3%-1.2%1.4%
90 Day13.9%0.2%8.7%
1 Year-15.8%-15.8%10.1%-3.7%22.7%20.1%
3 Year3.3%3.3%29.9%5.2%50.1%40.5%
5 Year17.9%17.9%38.3%8.3%73.1%54.1%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

38.0%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: FOE ($14.65) is trading below our estimate of fair value ($23.62)

Significantly Below Fair Value: FOE is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: FOE is poor value based on its PE Ratio (25x) compared to the Chemicals industry average (22.2x).

PE vs Market: FOE is poor value based on its PE Ratio (25x) compared to the US market (18.4x).


Price to Earnings Growth Ratio

PEG Ratio: FOE is poor value based on its PEG Ratio (1.4x)


Price to Book Ratio

PB vs Industry: FOE is overvalued based on its PB Ratio (3.2x) compared to the US Chemicals industry average (2.2x).


Next Steps

Future Growth

How is Ferro forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

17.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: FOE's forecast earnings growth (17.7% per year) is above the savings rate (1.7%).

Earnings vs Market: FOE's earnings (17.7% per year) are forecast to grow faster than the US market (14.5% per year).

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

Revenue vs Market: FOE's revenue is expected to decline over the next 3 years (-6.6% per year).

High Growth Revenue: FOE's revenue is forecast to decline over the next 3 years (-6.6% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: FOE's Return on Equity is forecast to be high in 3 years time (25%)


Next Steps

Past Performance

How has Ferro performed over the past 5 years?

9.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: FOE has a large one-off loss of $21.2M impacting its September 30 2019 financial results.

Growing Profit Margin: FOE's current net profit margins (3.1%) are lower than last year (3.8%).


Past Earnings Growth Analysis

Earnings Trend: FOE's earnings have grown by 9.2% per year over the past 5 years.

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

Earnings vs Industry: FOE had negative earnings growth (-20.1%) over the past year, making it difficult to compare to the Chemicals industry average (-14.6%).


Return on Equity

High ROE: FOE's Return on Equity (12.8%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Ferro's financial position?


Financial Position Analysis

Short Term Liabilities: FOE's short term assets ($843.8M) exceed its short term liabilities ($322.7M).

Long Term Liabilities: FOE's short term assets ($843.8M) do not cover its long term liabilities ($1.1B).


Debt to Equity History and Analysis

Debt Level: FOE's debt to equity ratio (222.3%) is considered high.

Reducing Debt: FOE's debt to equity ratio has increased from 90.6% to 222.3% over the past 5 years.

Debt Coverage: FOE's debt is not well covered by operating cash flow (9.3%).

Interest Coverage: FOE's interest payments on its debt are well covered by EBIT (3.5x coverage).


Balance Sheet

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

Debt Coverage by Assets: FOE's debt is not covered by short term assets (assets are 1x debt).


Next Steps

Dividend

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


Dividend Yield vs Market

company0%marketbottom25%1.4%markettop25%3.7%industryaverage2.2%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate FOE's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate FOE's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if FOE's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if FOE's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: FOE is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of FOE's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

5.4yrs

Average management tenure


CEO

Peter Thomas (63yo)

6.8yrs

Tenure

US$4,853,673

Compensation

Mr. Peter T. Thomas has been the Chief Executive Officer and President of Ferro Corporation since April 24, 2013. Mr. Thomas served as Interim Chief Executive Officer and Interim President at Ferro Corpora ...


CEO Compensation Analysis

Compensation vs Market: Peter's total compensation ($USD4.85M) is about average for companies of similar size in the US market ($USD3.76M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Peter Thomas
Chairman6.8yrsUS$4.85m0.83% $9.9m
Benjamin Schlater
Group VP & CFO3.4yrsUS$1.28m0.024% $293.8k
Mark Duesenberg
VP, General Counsel & Secretary11.4yrsUS$1.26m0.24% $2.9m
Matthias Bell
Group Vice President of Global Operations1.1yrsno datano data
Andrew Henke
Interim Principal Accounting Officer0.4yrsno data0.0037% $43.8k
Kevin Grant
Head of Investor Relations0yrsno datano data
Mary Abood
Director of Corporate Communications13.8yrsno datano data
Jose Tortajada
Vice President of Human Resources3.9yrsno datano data
Judy DeForest
Chief Tax Officer12.3yrsno datano data

5.4yrs

Average Tenure

57yo

Average Age

Experienced Management: FOE's management team is seasoned and experienced (5.4 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Peter Thomas
Chairman6.8yrsUS$4.85m0.83% $9.9m
Allen Spizzo
Independent Director3.3yrsUS$182.69k0.0061% $73.3k
Ronald Vargo
Independent Director10.2yrsUS$189.45k0.044% $534.0k
Marran J. Ogilvie
Independent Director2.3yrsUS$169.45k0.0024% $29.3k
David Lorber
Lead Director2.1yrsUS$207.95k0.027% $322.3k
Andrew Ross
Independent Director3.3yrsUS$169.45k0.011% $131.9k

3.3yrs

Average Tenure

59.5yo

Average Age

Experienced Board: FOE's board of directors are considered experienced (3.3 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Ferro Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Ferro Corporation
  • Ticker: FOE
  • Exchange: NYSE
  • Founded: 1919
  • Industry: Specialty Chemicals
  • Sector: Materials
  • Market Cap: US$1.201b
  • Shares outstanding: 81.97m
  • Website: https://www.ferro.com

Number of Employees


Location

  • Ferro Corporation
  • 6060 Parkland Boulevard
  • Suite 250
  • Mayfield Heights
  • Ohio
  • 44124
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
FOENYSE (New York Stock Exchange)YesCommon StockUSUSDJan 1968
FR9DB (Deutsche Boerse AG)YesCommon StockDEEURJan 1968

Biography

Ferro Corporation produces specialty materials in the United States and internationally. It operates through three segments: Performance Coatings, Performance Colors and Glass, and Color Solutions. The company offers frits, porcelain and other glass enamels, glazes, stains, decorating colors, pigments, inks, polishing materials, dielectrics, electronic glasses, and other specialty coatings. Its products are used in appliances, household furnishings, automotive, industrial products, building and renovation, packaging, electronics, and sanitary applications. The company markets and sells its products directly, as well as through agents and distributors. Its customers include manufacturers of ceramic tiles, appliances, construction materials, automobile parts, automobiles, architectural and container glass, and electronic components and devices. The company was founded in 1919 and is headquartered in Mayfield Heights, Ohio. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/16 23:40
End of Day Share Price2020/02/14 00:00
Earnings2019/09/30
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.