NYSE:SCL

Stock Analysis Report

Executive Summary

Stepan Company, together with its subsidiaries, produces and sells specialty and intermediate chemicals to other manufacturers for use in various end products in North America, Europe, Latin America, and Asia.

Snowflake

Fundamentals

Flawless balance sheet with acceptable track record.


Similar Companies

Share Price & News

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


Latest Share Price and Events


Market Performance


7 Day Return

2.1%

NYSE:SCL

0.2%

US Chemicals

2.1%

US Market


1 Year Return

7.7%

NYSE:SCL

-16.1%

US Chemicals

-0.04%

US Market

SCL outperformed the Chemicals industry which returned -15.1% over the past year.

SCL outperformed the Market in United States of America which returned 0.2% over the past year.


Share holder returns

SCLIndustryMarket
7 Day2.1%0.2%2.1%
30 Day0.2%-6.7%-3.2%
90 Day10.2%-1.4%2.8%
1 Year8.9%7.7%-2.7%-16.1%2.2%-0.04%
3 Year37.9%33.5%33.7%9.1%41.5%32.3%
5 Year109.1%96.9%29.8%1.4%55.0%37.8%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

21.17x

Price to Earnings (PE) ratio


Intrinsic Value Based on Future Cash Flows

Stepan's share price is above the future cash flow value, it's not available at a moderate discount (< 20%).

Stepan's share price is above the future cash flow value, it's not available at a substantial discount (< 40%).


Price Based on Earnings

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

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


Price Based on Expected Growth

Stepan is poor value based on expected growth next year.


Price Based on Value of Assets

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


Next Steps

Future Growth

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

11.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Stepan's revenue is expected to grow by 4.5% yearly, however this is not considered high growth (20% yearly).

Stepan's earnings are expected to grow by 11% yearly, however this is not considered high growth (20% yearly).

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

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

Stepan'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 Stepan will efficiently use shareholders’ funds in the future without estimates of Return on Equity.


Next Steps

Past Performance

How has Stepan performed over the past 5 years?

11.2%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Stepan's year on year earnings growth rate has been positive over the past 5 years.

Stepan's 1-year earnings growth is less than its 5-year average (5.5% vs 11.2%)

Stepan's earnings growth has exceeded the US Chemicals industry average in the past year (5.5% vs -2.4%).


Return on Equity

Stepan has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).


Return on Assets

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


Return on Capital Employed

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


Next Steps

Financial Health

How is Stepan's financial position?


Financial Position Analysis

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

Stepan's cash and other short term assets cover its long term commitments.


Debt to Equity History and Analysis

Stepan's level of debt (27.1%) compared to net worth is satisfactory (less than 40%).

The level of debt compared to net worth has been reduced over the past 5 years (46.3% vs 27.1% today).

Debt is well covered by operating cash flow (84.3%, greater than 20% of total debt).

Interest payments on debt are well covered by earnings (EBIT is 16.3x coverage).


Balance Sheet

High level of physical assets or inventory.

Debt is covered by short term assets, assets are 3.5x debt.


Next Steps

Dividend

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

1.03%

Expected Dividend Yield


Upcoming Dividend Payment

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


Dividend Yield and Payments Analysis

Stepan's pays a lower dividend yield than the bottom 25% of dividend payers in United States of America (1.49%).

Stepan's dividend is below the markets top 25% of dividend payers in United States of America (3.84%).

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 (4.6x 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 Stepan's salary, the management and board of directors tenure and is there insider trading?

1.6yrs

Average management tenure


CEO

F. Stepan (58yo)

13.6yrs

Tenure

US$3,716,937

Compensation

Mr. F. Quinn Stepan, Jr., has been the Chief Executive Officer of Stepan Company since January 1, 2006 and its President since February 1999. Mr. Stepan served as a Vice President and General Manager of Su ...


CEO Compensation Analysis

F.'s remuneration is about average for companies of similar size in United States of America.

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


Management Age and Tenure

1.6yrs

Average Tenure

57yo

Average Age

The average tenure for the Stepan management team is less than 2 years, this suggests a new team.


Board Age and Tenure

7.6yrs

Average Tenure

59yo

Average Age

The tenure for the Stepan board of directors is about average.


Insider Trading

Stepan individual insiders have sold more shares than they have bought in the past 3 months.


Recent Insider Transactions

SellUS$96,45901 Aug 19
Sean Moriarty
EntityIndividual
Shares959
Max PriceUS$100.58
SellUS$134,97829 Jul 19
Scott Behrens
EntityIndividual
Shares1,386
Max PriceUS$97.39
SellUS$177,54512 Jun 19
Frank Pacholec
EntityIndividual
Role
Head of Corporate Development
Vice President of Strategy & Corporate Development
Shares1,931
Max PriceUS$91.94
SellUS$27,79012 Jun 19
Debra Stefaniak
EntityIndividual
Shares300
Max PriceUS$92.63
SellUS$108,62012 Jun 19
Edward Wehmer
EntityIndividual
Role
Lead Director
Lead Independent Director
Shares1,200
Max PriceUS$90.57
BuyUS$42,77028 May 19
Luis Rojo
EntityIndividual
Role
Chief Financial Officer
VP & CFO
Shares500
Max PriceUS$85.54
BuyUS$25,99224 May 19
Luis Rojo
EntityIndividual
Role
Chief Financial Officer
VP & CFO
Shares300
Max PriceUS$86.64
BuyUS$17,43816 May 19
Luis Rojo
EntityIndividual
Role
Chief Financial Officer
VP & CFO
Shares200
Max PriceUS$87.19
BuyUS$22,05909 May 19
Luis Rojo
EntityIndividual
Role
Chief Financial Officer
VP & CFO
Shares250
Max PriceUS$88.23
SellUS$200,59307 May 19
Gregory Lawton
EntityIndividual
Role
Member of the Board of Directors
Director
Shares2,201
Max PriceUS$91.14
BuyUS$22,39307 May 19
Luis Rojo
EntityIndividual
Role
Chief Financial Officer
VP & CFO
Shares250
Max PriceUS$89.57
SellUS$179,56919 Mar 19
Scott Behrens
EntityIndividual
Shares2,000
Max PriceUS$89.78
SellUS$18,02019 Mar 19
Debra Stefaniak
EntityIndividual
Shares200
Max PriceUS$90.10
BuyUS$17,95019 Mar 19
Luis Rojo
EntityIndividual
Role
Chief Financial Officer
VP & CFO
Shares200
Max PriceUS$89.75
BuyUS$18,17414 Mar 19
Luis Rojo
EntityIndividual
Role
Chief Financial Officer
VP & CFO
Shares200
Max PriceUS$90.87
SellUS$182,48413 Mar 19
Scott Behrens
EntityIndividual
Shares2,000
Max PriceUS$91.24
BuyUS$9,01708 Mar 19
Luis Rojo
EntityIndividual
Role
Chief Financial Officer
VP & CFO
Shares100
Max PriceUS$90.17
BuyUS$31,48818 Dec 18
Luis Rojo
EntityIndividual
Role
Chief Financial Officer
VP & CFO
Shares400
Max PriceUS$78.72
SellUS$15,97513 Dec 18
Debra Stefaniak
EntityIndividual
Shares200
Max PriceUS$79.88
SellUS$185,50409 Nov 18
Gregory Lawton
EntityIndividual
Role
Member of the Board of Directors
Director
Shares2,114
Max PriceUS$87.75
SellUS$125,62805 Nov 18
Arthur Mergner
EntityIndividual
Shares1,500
Max PriceUS$83.99
SellUS$118,87031 Oct 18
Edward Wehmer
EntityIndividual
Role
Lead Director
Lead Independent Director
Shares1,400
Max PriceUS$84.91
SellUS$44,74514 Sep 18
Frank Pacholec
EntityIndividual
Role
Head of Corporate Development
Vice President of Strategy & Corporate Development
Shares500
Max PriceUS$89.50
SellUS$61,22710 Sep 18
Frank Pacholec
EntityIndividual
Role
Head of Corporate Development
Vice President of Strategy & Corporate Development
Shares699
Max PriceUS$87.59

Ownership Breakdown


Management Team

  • F. Stepan (58yo)

    Chairman

    • Tenure: 13.6yrs
    • Compensation: US$3.72m
  • John Venegoni (60yo)

    Consultant

    • Tenure: 4.9yrs
    • Compensation: US$1.19m
  • Frank Pacholec (63yo)

    Vice President of Strategy & Corporate Development

    • Tenure: 3.2yrs
  • Matthew Eaken (56yo)

    VP & Corporate Controller

    • Tenure: 8.6yrs
    • Compensation: US$492.25k
  • Jennifer Hale (57yo)

    Consultant

    • Tenure: 0.9yrs
    • Compensation: US$2.18m
  • Luis Rojo (46yo)

    VP & CFO

    • Tenure: 1.3yrs
    • Compensation: US$1.05m
  • David Mattingly

    VP & Chief Compliance Officer

    • Tenure: 1.6yrs
  • Janet Catlett (42yo)

    VP & Chief Human Resources Officer

    • Tenure: 1.1yrs
  • Jason Keiper

    VP & Chief Technology and Sustainability Officer

    • Tenure: 0.0yrs
  • David Kabbes

    VP, General Counsel & Secretary

    • Tenure: 0.6yrs

Board Members

  • Ed Wehmer (65yo)

    Lead Independent Director

    • Tenure: 2.7yrs
    • Compensation: US$204.98k
  • Jan Reed (59yo)

    Director

    • Tenure: 3.8yrs
    • Compensation: US$177.48k
  • F. Stepan (58yo)

    Chairman

    • Tenure: 13.6yrs
    • Compensation: US$3.72m
  • Greg Lawton (68yo)

    Director

    • Tenure: 13.3yrs
    • Compensation: US$184.98k
  • Michael Boyce (71yo)

    Director

    • Tenure: 9.6yrs
    • Compensation: US$179.98k
  • Joaquin Delgado (59yo)

    Director

    • Tenure: 8.6yrs
    • Compensation: US$169.98k
  • Randy Dearth (55yo)

    Director

    • Tenure: 7.6yrs
    • Compensation: US$169.98k

Company Information

Stepan Company's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Stepan Company
  • Ticker: SCL
  • Exchange: NYSE
  • Founded: 1932
  • Industry: Specialty Chemicals
  • Sector: Materials
  • Market Cap: US$2.126b
  • Shares outstanding: 22.56m
  • Website: https://www.stepan.com

Number of Employees


Location

  • Stepan Company
  • Edens and Winnetka Road
  • Northfield
  • Illinois
  • 60093
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SCLNYSE (New York Stock Exchange)YesCommon StockUSUSDJan 1968
96SDB (Deutsche Boerse AG)YesCommon StockDEEURJan 1968

Biography

Stepan Company, together with its subsidiaries, produces and sells specialty and intermediate chemicals to other manufacturers for use in various end products in North America, Europe, Latin America, and A ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/08/22 23:44
End of Day Share Price2019/08/22 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.