NYSE:KEM

Stock Analysis Report

Executive Summary

KEMET Corporation manufactures and sells passive electronic components under the KEMET brand worldwide.

Rewards

Trading at 28.1% below its fair value

Earnings grew by 70.9% over the past year

Risk Analysis

Earnings are forecast to decline by an average of -28.9% per year for the next 3 years

High level of non-cash earnings

Has a high level of debt



Snowflake Analysis

Excellent balance sheet with solid track record.


Similar Companies

Murata Manufacturing

TSE:6981

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

-0.8%

KEM

-1.5%

US Electronic

-1.3%

US Market


1 Year Return

28.1%

KEM

23.9%

US Electronic

22.0%

US Market

Return vs Industry: KEM exceeded the US Electronic industry which returned 30.2% over the past year.

Return vs Market: KEM exceeded the US Market which returned 24.7% over the past year.


Shareholder returns

KEMIndustryMarket
7 Day-0.8%-1.5%-1.3%
30 Day-1.4%1.1%1.6%
90 Day16.4%7.3%8.9%
1 Year29.1%28.1%25.2%23.9%24.7%22.0%
3 Year275.9%271.9%48.0%43.8%49.4%39.7%
5 Year601.4%593.9%88.8%79.2%78.1%58.5%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

28.7%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: KEM ($26.73) is trading below our estimate of fair value ($37.15)

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


Price To Earnings Ratio

PE vs Industry: KEM is good value based on its PE Ratio (9.8x) compared to the Electronic industry average (21.2x).

PE vs Market: KEM is good value based on its PE Ratio (9.8x) compared to the US market (18.9x).


Price to Earnings Growth Ratio

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


Price to Book Ratio

PB vs Industry: KEM is overvalued based on its PB Ratio (2.4x) compared to the US Electronic industry average (2.1x).


Next Steps

Future Growth

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

-28.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: KEM's earnings are forecast to decline over the next 3 years (-28.9% per year).

Earnings vs Market: KEM's earnings are forecast to decline over the next 3 years (-28.9% per year).

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

Revenue vs Market: KEM's revenue is expected to decline over the next 3 years (-0.3% per year).

High Growth Revenue: KEM's revenue is forecast to decline over the next 3 years (-0.3% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if KEM's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has KEMET performed over the past 5 years?

52.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: KEM has a high level of non-cash earnings.

Growing Profit Margin: KEM's current net profit margins (11.6%) are higher than last year (7.2%).


Past Earnings Growth Analysis

Earnings Trend: KEM has become profitable over the past 5 years, growing earnings by 52.4% per year.

Accelerating Growth: KEM's earnings growth over the past year (70.9%) exceeds its 5-year average (52.4% per year).

Earnings vs Industry: KEM earnings growth over the past year (70.9%) exceeded the Electronic industry 53.6%.


Return on Equity

High ROE: KEM's Return on Equity (24.5%) is considered high.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is KEMET's financial position?


Financial Position Analysis

Short Term Liabilities: KEM's short term assets ($672.9M) exceed its short term liabilities ($312.7M).

Long Term Liabilities: KEM's short term assets ($672.9M) exceed its long term liabilities ($438.1M).


Debt to Equity History and Analysis

Debt Level: KEM's debt to equity ratio (47.8%) is considered high.

Reducing Debt: KEM's debt to equity ratio has reduced from 187.2% to 47.8% over the past 5 years.

Debt Coverage: KEM's debt is well covered by operating cash flow (48.4%).

Interest Coverage: KEM's interest payments on its debt are well covered by EBIT (26.5x coverage).


Balance Sheet

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

Debt Coverage by Assets: KEM's debt is covered by short term assets (assets are 2.2x debt).


Next Steps

Dividend

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

0.76%

Current Dividend Yield


Dividend Yield vs Market

company0.8%marketbottom25%1.4%markettop25%3.7%industryaverage1.5%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: KEM's dividend (0.75%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.4%).

High Dividend: KEM's dividend (0.75%) is low compared to the top 25% of dividend payers in the US market (3.66%).


Stability and Growth of Payments

Stable Dividend: KEM is not paying a notable dividend for the US market, therefore no need to check if payments are stable.

Growing Dividend: KEM is not paying a notable dividend for the US market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

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


Future Payout to Shareholders

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


Next Steps

Management

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

7.0yrs

Average management tenure


CEO

Bill Lowe (66yo)

1.1yrs

Tenure

US$3,586,356

Compensation

Mr. William M. Lowe, Jr., also known as Bill, has been Chief Executive Officer and Director of KEMET Corporation since December 19, 2018. Mr. Lowe served as the Chief Financial Officer and Executive Vice P ...


CEO Compensation Analysis

Compensation vs Market: Bill's total compensation ($USD3.59M) is about average for companies of similar size in the US market ($USD3.86M).

Compensation vs Earnings: Bill's compensation has increased by more than 20% in the past year.


Management Age and Tenure

7.0yrs

Average Tenure

58yo

Average Age

Experienced Management: KEM's management team is seasoned and experienced (7 years average tenure).


Board Age and Tenure

11.8yrs

Average Tenure

71yo

Average Age

Experienced Board: KEM's board of directors are seasoned and experienced ( 11.8 years average tenure).


Insider Trading

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


Recent Insider Transactions

SellUS$6,112,58302 Jan 20
Magnetar Capital, LLC
EntityCompany
Shares229,312
Max PriceUS$26.89
BuyUS$2,106,81002 Jan 20
Magnetar Capital, LLC
EntityCompany
Shares78,640
Max PriceUS$26.88
BuyUS$79,240,79427 Nov 19
Magnetar Capital, LLC
EntityCompany
Shares3,045,019
Max PriceUS$26.25
SellUS$68,68227 Nov 19
Magnetar Capital, LLC
EntityCompany
Shares3,194
Max PriceUS$23.14
SellUS$398,56515 Aug 19
Shigenori Oyama
EntityIndividual
Shares22,500
Max PriceUS$17.71
SellUS$52,36030 May 19
Shigenori Oyama
EntityIndividual
Shares3,102
Max PriceUS$16.88
SellUS$560,67021 Feb 19
Shigenori Oyama
EntityIndividual
Shares30,000
Max PriceUS$18.69
SellUS$380,27221 Feb 19
Charles Meeks
EntityIndividual
Role
Senior Key Executive
Executive Vice President of Solid Capacitors-Tantalum
Shares20,000
Max PriceUS$19.01
BuyUS$199,51508 Feb 19
Gregory Thompson
EntityIndividual
Role
Chief Financial Officer
Executive VP & CFO
Shares11,100
Max PriceUS$18.02
SellUS$223,22907 Feb 19
Robert Paul
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares11,998
Max PriceUS$18.61
SellUS$458,68005 Feb 19
Charles Meeks
EntityIndividual
Role
Senior Key Executive
Executive Vice President of Solid Capacitors-Tantalum
Shares25,000
Max PriceUS$18.35

Ownership Breakdown

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


Management Team

  • Greg Thompson (63yo)

    Executive VP & CFO

    • Tenure: 1.1yrs
    • Compensation: US$3.06m
  • Bill Lowe (66yo)

    CEO & Director

    • Tenure: 1.1yrs
    • Compensation: US$3.59m
  • Chuck Meeks (58yo)

    Executive Vice President of Solid Capacitors-Tantalum

    • Tenure: 12.3yrs
    • Compensation: US$1.69m
  • Phil Lessner (60yo)

    Senior VP & CTO

    • Tenure: 5.9yrs
    • Compensation: US$681.25k
  • Sue Barkal (56yo)

    Senior VP of Quality

    • Tenure: 11.1yrs
  • Brian Burch (51yo)

    Chief Information Officer & VP

    • Tenure: 8.1yrs
  • Jamie Assaf (59yo)

    Senior VP

    • Tenure: 11.5yrs
    • Compensation: US$1.04m
  • Stefano Vetralla (56yo)

    Senior VP & Chief HR Officer

    • Tenure: 5.7yrs
    • Compensation: US$2.74m
  • Claudio Lollini (39yo)

    Senior Vice President of Global Sales & Marketing

    • Compensation: US$1.10m
  • Robin Blackwell

    Vice President of Corporate Communications & Investor Relations


    Board Members

    • Gurminder Bedi (71yo)

      Independent Director

      • Tenure: 13.7yrs
      • Compensation: US$345.00k
    • Robert Paul (77yo)

      Independent Director

      • Tenure: 13.5yrs
      • Compensation: US$345.00k
    • E. Maddrey (78yo)

      Independent Director

      • Tenure: 27.7yrs
      • Compensation: US$345.00k
    • Bill Lowe (66yo)

      CEO & Director

      • Tenure: 1.1yrs
      • Compensation: US$3.59m
    • Frank Brandenberg (72yo)

      Independent Chairman of the Board

      • Tenure: 14.8yrs
      • Compensation: US$360.00k
    • Wilfried Backes (76yo)

      Independent Director

      • Tenure: 11.8yrs
      • Compensation: US$345.00k
    • Jacob Kotzubei (50yo)

      Independent Director

      • Tenure: 8.3yrs
      • Compensation: US$330.00k
    • Karen Rogge (64yo)

      Independent Director

      • Tenure: 1.7yrs
      • Compensation: US$280.80k
    • Yasuko Matsumoto (55yo)

      Independent Director

      • Tenure: 2.6yrs
      • Compensation: US$325.00k

    Company Information

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


    Key Information

    • Name: KEMET Corporation
    • Ticker: KEM
    • Exchange: NYSE
    • Founded: 1919
    • Industry: Electronic Manufacturing Services
    • Sector: Tech
    • Market Cap: US$1.536b
    • Shares outstanding: 58.27m
    • Website: https://www.kemet.com

    Number of Employees


    Location

    • KEMET Corporation
    • KEMET Tower
    • One East Broward Boulevard
    • Fort Lauderdale
    • Florida
    • 33301
    • United States

    Listings

    TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
    KEMNYSE (New York Stock Exchange)YesCommon StockUSUSDOct 1992
    KM1NDB (Deutsche Boerse AG)YesCommon StockDEEUROct 1992

    Biography

    KEMET Corporation manufactures and sells passive electronic components under the KEMET brand worldwide. The company operates in three segments: Solid Capacitors; Film and Electrolytic; and Electro-Magnetic, Sensors, and Actuators. It offers tantalum, aluminum polymer, and ceramic capacitors; film, paper, and wet aluminum electrolytic capacitors; electromagnetic interference filters; and electro-magnetic compatible materials and devices, piezo materials and actuators, and various types of sensors. The company serves electronics original equipment manufacturers, electronics manufacturing services providers, and distributors in various industries, including automotive, communications, computer-related, industrial, consumer, military/aerospace, and alternative energy. It sells its products through direct sales force and independent sales representatives. KEMET Corporation was founded in 1919 and is headquartered in Fort Lauderdale, Florida. 


    Company Analysis and Financial Data Status

    All financial data provided by Standard & Poor's Capital IQ.
    DataLast Updated (UTC time)
    Company Analysis2020/01/25 23:37
    End of Day Share Price2020/01/24 00:00
    Earnings2019/09/30
    Annual Earnings2019/03/31


    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.