NYSE:OEC

Stock Analysis Report

Orion Engineered Carbons

Executive Summary

Orion Engineered Carbons S.A., together with its subsidiaries, produces and sells carbon black products in Germany, the United States, South Korea, Brazil, China, South Africa, the rest of Europe, and internationally.


Snowflake Analysis

Good value with adequate balance sheet and pays a dividend.


Similar Companies

Share Price & News

How has Orion Engineered Carbons's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: OEC's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-9.5%

OEC

-6.0%

US Chemicals

-2.6%

US Market


1 Year Return

-65.4%

OEC

-33.1%

US Chemicals

-13.3%

US Market

Return vs Industry: OEC underperformed the US Chemicals industry which returned -33.1% over the past year.

Return vs Market: OEC underperformed the US Market which returned -13.3% over the past year.


Shareholder returns

OECIndustryMarket
7 Day-9.5%-6.0%-2.6%
30 Day-51.3%-20.3%-15.2%
90 Day-64.3%-30.3%-22.2%
1 Year-63.8%-65.4%-28.8%-33.1%-11.5%-13.3%
3 Year-62.8%-66.7%-12.2%-29.2%13.2%5.7%
5 Year-56.3%-64.3%-2.3%-23.5%31.8%17.2%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Orion Engineered Carbons undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: OEC ($6.75) is trading below our estimate of fair value ($13.97)

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


Price To Earnings Ratio

PE vs Industry: OEC is good value based on its PE Ratio (4.7x) compared to the Chemicals industry average (14.2x).

PE vs Market: OEC is good value based on its PE Ratio (4.7x) compared to the US market (12.5x).


Price to Earnings Growth Ratio

PEG Ratio: OEC's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: OEC is overvalued based on its PB Ratio (2.2x) compared to the US Chemicals industry average (1.4x).


Next Steps

Future Growth

How is Orion Engineered Carbons forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

-9.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: OEC's earnings are forecast to decline over the next 3 years (-9.9% per year).

Earnings vs Market: OEC's earnings are forecast to decline over the next 3 years (-9.9% per year).

High Growth Earnings: OEC's earnings are forecast to decline over the next 3 years.

Revenue vs Market: OEC's revenue (0.5% per year) is forecast to grow slower than the US market (7% per year).

High Growth Revenue: OEC's revenue (0.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: OEC's Return on Equity is forecast to be high in 3 years time (31.6%)


Next Steps

Past Performance

How has Orion Engineered Carbons performed over the past 5 years?

40.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: OEC has high quality earnings.

Growing Profit Margin: OEC's current net profit margins (5.9%) are lower than last year (7.7%).


Past Earnings Growth Analysis

Earnings Trend: OEC has become profitable over the past 5 years, growing earnings by 40.7% per year.

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

Earnings vs Industry: OEC had negative earnings growth (-28.3%) over the past year, making it difficult to compare to the Chemicals industry average (-11.3%).


Return on Equity

High ROE: Whilst OEC's Return on Equity (46.73%) is outstanding, this metric is skewed due to their high level of debt.


Next Steps

Financial Health

How is Orion Engineered Carbons's financial position?


Financial Position Analysis

Short Term Liabilities: OEC's short term assets ($507.7M) exceed its short term liabilities ($285.2M).

Long Term Liabilities: OEC's short term assets ($507.7M) do not cover its long term liabilities ($786.2M).


Debt to Equity History and Analysis

Debt Level: OEC's debt to equity ratio (358.4%) is considered high.

Reducing Debt: OEC's debt to equity ratio has reduced from 1215.5% to 358.4% over the past 5 years.

Debt Coverage: OEC's debt is well covered by operating cash flow (34.7%).

Interest Coverage: OEC's interest payments on its debt are well covered by EBIT (8.9x coverage).


Balance Sheet


Next Steps

Dividend

What is Orion Engineered Carbons's current dividend yield, its reliability and sustainability?

11.85%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: OEC's dividend (11.85%) is higher than the bottom 25% of dividend payers in the US market (2.01%).

High Dividend: OEC's dividend (11.85%) is in the top 25% of dividend payers in the US market (5.66%)


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, OEC has been paying a dividend for less than 10 years.

Growing Dividend: OEC has only been paying a dividend for 6 years, and since then payments have fallen.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (55.2%), OEC's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: OEC's dividends in 3 years are forecast to be covered by earnings (51.9% payout ratio).


Next Steps

Management

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

1.2yrs

Average management tenure


CEO

Corning Painter (57yo)

1.5s

Tenure

Mr. Corning F. Painter has been Chief Executive Officer and Director of Orion Engineered Carbons, S.A. since October 16, 2018. He served as an Executive Vice President of Industrial Gases at Air Products a ...


Leadership Team

NamePositionTenureCompensationOwnership
Corning Painter
CEO & Director1.5yrsno data0.45% $1.8m
Lorin Crenshaw
Chief Financial Officer0.42yrno data0.019% $77.3k
Carlos Quinones
Senior Vice President of Global Operations0.83yrno data0.070% $282.7k
Andre Schulze
Chief Accounting Officer and Head of Consolidation & Reportingno datano data0.015% $62.0k
Michael Reers
Chief Administration Officer0.58yrno data0.043% $175.5k
Christian Eggert
Senior VP7.67yrsno data0.087% $352.3k
Patrick Tuttle
Senior Vice President of Global Human Resources0.83yrno data0.067% $271.5k
Jack Clem
Advisor & Director1.5yrsno data0.67% $2.7m
Lixing Min
Senior VP & GM of Asia - Pacific Region7yrsno data0.17% $681.7k
David Deters
Senior Vice President of Innovation4.67yrsno data0.072% $293.6k

1.2yrs

Average Tenure

51.5yo

Average Age

Experienced Management: OEC's management team is not considered experienced ( 1.2 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Corning Painter
CEO & Director1.5yrsno data0.45% $1.8m
Jack Clem
Advisor & Director1.5yrsno data0.67% $2.7m
Dan Smith
Chairman of the Boardno datano data0.039% $157.4k
Kerry Galvin
Independent Director1.67yrsno data0.022% $88.9k
Hans-Dietrich Winkhaus
Independent Directorno datano data0.015% $59.5k
Paul Huck
Independent Directorno datano data0.039% $157.4k
Marc Jean Faber
Director2.83yrsno datano data
Didier Miraton
Independent Directorno datano data0.014% $56.1k

1.6yrs

Average Tenure

66.5yo

Average Age

Experienced Board: OEC's board of directors are not considered experienced ( 1.6 years average tenure), which suggests a new board.


Ownership

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


Insider Trading Volume

Insider Buying: OEC 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

Orion Engineered Carbons S.A.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Orion Engineered Carbons S.A.
  • Ticker: OEC
  • Exchange: NYSE
  • Founded: 2011
  • Industry: Commodity Chemicals
  • Sector: Materials
  • Market Cap: US$406.513m
  • Shares outstanding: 60.22m
  • Website: https://www.orioncarbons.com

Number of Employees


Location

  • Orion Engineered Carbons S.A.
  • 4501 Magnolia Cove Drive
  • Suite 106
  • Houston
  • Texas
  • 77345
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
OECNYSE (New York Stock Exchange)YesOrdinary Registered SharesUSUSDJul 2014
0OEDB (Deutsche Boerse AG)YesOrdinary Registered SharesDEEURJul 2014

Biography

Orion Engineered Carbons S.A., together with its subsidiaries, produces and sells carbon black products in Germany, the United States, South Korea, Brazil, China, South Africa, the rest of Europe, and internationally. It operates through two segments, Specialty Carbon Black and Rubber Carbon Black. The company offers post-treated specialty carbon black grades for coatings and printing applications; high purity carbon black grades for the fiber industry; and various conductive carbon black grades for use in polymer and printing applications, as well as in silicon, non-woven textile, building material, battery electrodes metallurgical, agrochemical, and carbon brush applications. It also provides rubber carbon black products for applications in mechanical rubber goods under the PUREX brand, as well as in tires under the ECORAX brand name. The company was formerly known as Orion Engineered Carbons S.à r.l. and changed its name to Orion Engineered Carbons S.A. in July 2014. Orion Engineered Carbons S.A. was incorporated in 2011 and is headquartered in Houston, Texas. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/07 16:29
End of Day Share Price2020/04/06 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


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.