NYSE:NEU

Stock Analysis Report

Executive Summary

NewMarket Corporation, through its subsidiaries, engages in the petroleum additives businesses.

Snowflake

Fundamentals

Average dividend payer with acceptable track record.

Risks

  • NewMarket is covered by less than 3 analysts.

Similar Companies

Share Price & News

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


Latest Share Price and Events


Market Performance


7 Day Return

0.9%

NYSE:NEU

-0.05%

US Chemicals

0.2%

US Market


1 Year Return

18.6%

NYSE:NEU

-16.1%

US Chemicals

-0.7%

US Market

NEU outperformed the Chemicals industry which returned -15.3% over the past year.

NEU outperformed the Market in United States of America which returned 0.3% over the past year.


Share holder returns

NEUIndustryMarket
7 Day0.9%-0.05%0.2%
30 Day13.8%-4.5%-2.7%
90 Day13.5%-1.3%1.6%
1 Year20.6%18.6%-2.8%-16.1%1.6%-0.7%
3 Year12.0%6.5%33.9%9.3%40.0%30.9%
5 Year24.9%15.5%29.6%1.3%53.8%36.8%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is NewMarket undervalued based on future cash flows and its price relative to the stock market?

49%

Discount to future cash flow value


Intrinsic Value Based on Future Cash Flows

NewMarket's share price is below the future cash flow value, and at a moderate discount (> 20%).

NewMarket's share price is below the future cash flow value, and at a substantial discount (> 40%).


Price Based on Earnings

NewMarket is overvalued based on earnings compared to the US Chemicals industry average.

NewMarket is overvalued based on earnings compared to the United States of America market.


Price Based on Expected Growth

NewMarket is poor value based on expected growth next year.


Price Based on Value of Assets

NewMarket is overvalued based on assets compared to the US Chemicals industry average.


Next Steps

Future Growth

How is NewMarket expected to perform in the next 1 to 3 years based on estimates from 1 analyst?

7.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

NewMarket's revenue is expected to grow by 0.9% yearly, however this is not considered high growth (20% yearly).

NewMarket's earnings are expected to grow by 7.9% yearly, however this is not considered high growth (20% yearly).

NewMarket's revenue growth is positive but not above the United States of America market average.

NewMarket's earnings growth is positive but not above the United States of America market average.

NewMarket's earnings growth is expected to exceed the low risk savings rate of 2.7%.


Earnings per Share Growth Estimates


Future Return on Equity

Unable to establish if NewMarket will efficiently use shareholders’ funds in the future without estimates of Return on Equity.


Next Steps

Past Performance

How has NewMarket performed over the past 5 years?

-2.2%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

NewMarket's year on year earnings growth rate was negative over the past 5 years, however the most recent earnings are above average.

NewMarket's 1-year earnings growth exceeds its 5-year average (45.3% vs -2.2%)

NewMarket's earnings growth has exceeded the US Chemicals industry average in the past year (45.3% vs -2.4%).


Return on Equity

Whilst NewMarket made outstanding use of shareholders’ funds last year (Return on Equity greater than 40%), this is metric is skewed due to its high level of debt.


Return on Assets

NewMarket used its assets more efficiently than the US Chemicals industry average last year based on Return on Assets.


Return on Capital Employed

NewMarket's use of capital deteriorated last year versus 3 years ago (Return on Capital Employed).


Next Steps

Financial Health

How is NewMarket's financial position?


Financial Position Analysis

NewMarket is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.

NewMarket's long term commitments exceed its cash and other short term assets.


Debt to Equity History and Analysis

NewMarket's level of debt (115.2%) compared to net worth is high (greater than 40%).

The level of debt compared to net worth has increased over the past 5 years (73.5% vs 115.2% today).

Debt is well covered by operating cash flow (41.7%, greater than 20% of total debt).

Interest payments on debt are well covered by earnings (EBIT is 10.9x coverage).


Balance Sheet

High level of physical assets or inventory.

Debt is covered by short term assets, assets are 1.2x debt.


Next Steps

Dividend

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

1.48%

Expected Dividend Yield


Upcoming Dividend Payment

Purchase NewMarket before the 'Buy Limit' to receive their next dividend payment.


Dividend Yield and Payments Analysis

NewMarket's pays a higher dividend yield than the bottom 25% of dividend payers in United States of America (1.48%).

NewMarket's dividend is below the markets top 25% of dividend payers in United States of America (3.83%).

Dividends per share have been stable in the past 10 years.

Dividends per share have increased over the past 10 years.


Current Payout to Shareholders

Dividends paid are well covered by earnings (3.3x coverage).


Future Payout to Shareholders

Insufficient estimate data to determine if a dividend will be paid in 3 years and that it will be sustainable.


Next Steps

Management

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

5.4yrs

Average management tenure


CEO

Teddy Gottwald (58yo)

15.4yrs

Tenure

US$2,102,180

Compensation

Mr. Thomas E. Gottwald, also known as Teddy, has been the Chief Executive Officer and President at NewMarket Corporation since March 3, 2004 and serves as its Chairman of the Board since July 29, 2014. Mr. ...


CEO Compensation Analysis

Teddy's remuneration is lower than average for companies of similar size in United States of America.

Teddy's compensation has been consistent with company performance over the past year, both up more than 20%.


Management Age and Tenure

5.4yrs

Average Tenure

58yo

Average Age

The average tenure for the NewMarket management team is over 5 years, this suggests they are a seasoned and experienced team.


Board Age and Tenure

12.8yrs

Average Tenure

72yo

Average Age

The average tenure for the NewMarket board of directors is over 10 years, this suggests they are a seasoned and experienced board.


Insider Trading

No 3 month open market individual insider trading information.


Recent Insider Transactions

SellUS$4,816,24625 Feb 19
Thomas Gottwald
EntityIndividual
Role
Chief Executive Officer
Chairman
Shares11,000
Max PriceUS$441.30
SellUS$216,98414 Feb 19
James Rogers
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares500
Max PriceUS$433.97

Ownership Breakdown


Management Team

  • Teddy Gottwald (58yo)

    Chairman

    • Tenure: 15.4yrs
    • Compensation: US$2.10m
  • Bruce Hazelgrove (58yo)

    Executive VP & Chief Administrative Officer

    • Tenure: 0.0yrs
    • Compensation: US$1.23m
  • M. West (65yo)

    VP, General Counsel & Secretary

    • Tenure: 3.6yrs
    • Compensation: US$1.50m
  • Cameron Warner (60yo)

    Treasurer

    • Tenure: 7.8yrs
  • William Skrobacz (59yo)

    Principal Accounting Officer & Controller

    • Tenure: 6.3yrs
  • Brian Paliotti (42yo)

    VP & CFO

    • Tenure: 4.6yrs
    • Compensation: US$1.18m
  • Regina Harm (54yo)

    President of Afton Chemical Corporation

    • Tenure: 1.3yrs
    • Compensation: US$1.36m

Board Members

  • Bruce Gottwald (85yo)

    Director

    • Tenure: 57.6yrs
    • Compensation: US$85.00k
  • Teddy Gottwald (58yo)

    Chairman

    • Tenure: 15.4yrs
    • Compensation: US$2.10m
  • H. Harris (58yo)

    Independent Director

    • Tenure: 4.0yrs
    • Compensation: US$194.80k
  • Phyllis Cothran (72yo)

    Lead Director

    • Tenure: 0.0yrs
    • Compensation: US$199.80k
  • Mark Gambill (68yo)

    Independent Director

    • Tenure: 10.6yrs
    • Compensation: US$194.80k
  • Pat Hanley (74yo)

    Independent Director

    • Tenure: 14.9yrs
    • Compensation: US$184.80k
  • Jim Rogers (73yo)

    Independent Director

    • Tenure: 16.3yrs
    • Compensation: US$179.80k

Company Information

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


Key Information

  • Name: NewMarket Corporation
  • Ticker: NEU
  • Exchange: NYSE
  • Founded: 1887
  • Industry: Specialty Chemicals
  • Sector: Materials
  • Market Cap: US$5.275b
  • Shares outstanding: 11.19m
  • Website: https://www.newmarket.com

Number of Employees


Location

  • NewMarket Corporation
  • 330 South Fourth Street
  • Richmond
  • Virginia
  • 23219
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
NEUNYSE (New York Stock Exchange)YesCommon Stock Without Par ValueUSUSDJan 1968
UG9DB (Deutsche Boerse AG)YesCommon Stock Without Par ValueDEEURJan 1968

Biography

NewMarket Corporation, through its subsidiaries, engages in the petroleum additives businesses. The company offers lubricant additives for use in various vehicle and industrial applications, including engi ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/08/20 23:55
End of Day Share Price2019/08/20 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.