Paints, Varnishes, Lacquers, Enamels & Allied Prods
Axalta Coating Systems Ltd., through its subsidiaries, manufactures, markets, and distributes high-performance coatings systems in North America, Europe, the Middle East, Africa, the Asia Pacific, and Latin America. It operates through two segments, Performance Coatings and Mobility Coatings. The company offers water and solvent-borne products and systems to repair damaged vehicles for independent body shops, multi-shop operators, and original equipment manufacturer (OEM) dealership body shops. It also provides functional and decorative liquid, and powder coatings used in various industrial applications, including architectural cladding and fittings, automotive coatings, general industrial, job coaters, and energy solutions; and coatings for building materials, cabinet, wood and luxury vinyl flooring, and furniture market under the Voltatex, AquaEC, Durapon, Hydropon, UNRIVALED, Tufcote, and Ceranamel for liquid coatings; and Alesta, Nap-Gard, Abcite, Teodur, and Plascoat brands for powder coatings. In addition, the company develops and supplies electrocoat, primer, the basecoat, and clearcoat products for OEMs of light and commercial vehicles; and coatings systems for various commercial applications, including HDT, MDT, bus, and rail under the Imron, Imron Elite, Centari, Rival, Corlar epoxy undercoats, and AquaEC brands. It also sells its product under the Audurra, Challenger, Chemophan, ColorNet, Cromax, Cromax Mosaic, Durapon 70, Duxone, Harmonized Coating Technologies, Imron ExcelPro, Lutophen, Nason, Spies Hecker, Standox, Stollaquid, Syntopal, Syrox, Raptor, U-POL, and Vermeera brand names. The company was formerly known as Axalta Coating Systems Bermuda Co., Ltd. and changed its name to Axalta Coating Systems Ltd. in August 2014. The company was founded in 1866 and is headquartered in Philadelphia, Pennsylvania.
Sector
Discounted Cash Flow Valuation of Axalta Coating Systems Ltd.
Growth
%
%
Discount
%
%
Multiple
g\r | +10% | +11% | +12% | +13% | +14% |
---|---|---|---|---|---|
0% | 10 | 9 | 8 | 8 | 7 |
+1% | 11 | 10 | 9 | 8 | 8 |
+2% | 13 | 11 | 10 | 9 | 8 |
+3% | 14 | 13 | 11 | 10 | 9 |
+4% | 17 | 14 | 12 | 11 | 10 |
Years | 0 | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | TV |
---|---|---|---|---|---|---|---|---|---|---|---|---|
FCF | $542.6M | $544.2M | $545.7M | $547.3M | $548.9M | $550.5M | $552.1M | $553.7M | $555.3M | $556.9M | $558.5M | $5.585B |
DCF | $473.2M | $412.7M | $359.9M | $313.8M | $273.7M | $238.7M | $208.1M | $181.5M | $158.3M | $138M | $1.38B | |
Value | $4.138B |
In the chart Earnings are multiplied by this value.
High margins render the company resilient under dire circumstances, hence able to drive competitors out or acquire them. ROE and ROA measure the average flow generated by each invested dollar. Their marginal value is a forecast of future growth, and it is considered by Buffett and Munger the most important single indicator.
Years | 12-2015 | 12-2016 | 12-2017 | 12-2018 | 12-2019 | 12-2020 | 12-2021 | 12-2022 | 12-2023 | TTM |
---|---|---|---|---|---|---|---|---|---|---|
Net Margin | 2.3% | 1% | 0.84% | 4.4% | 5.6% | 3.3% | 6% | 3.9% | 5.2% | 4.7% |
ROA | 8% | 7% | 5.3% | 6.6% | 7.2% | 4.3% | 6.4% | 6% | 8.1% | 8.2% |
ROE | 8.2% | 3.3% | 2.6% | 16% | 18% | 8.2% | 17% | 13% | 15% | 14% |
The average Net Margin over the past 5 years is +4.71%.
The trend of Net Margin over the past 5 years is +0.04%.
The average ROA over the past 5 years is +6.42%.
The trend of ROA over the past 5 years is +0.17%.
The average ROE over the past 5 years is +14.45%.
The trend of ROE over the past 5 years is -0.27%.
Being debt the number one cause of investment losses and company death, the ratio Debt/FCF is of utmost importance to guarantee safety. On the other hand the Graham’s stability measures the drawdown of earnings, hence indicating the reliability of the flow generated by the company.
Years | 12-2015 | 12-2016 | 12-2017 | 12-2018 | 12-2019 | 12-2020 | 12-2021 | 12-2022 | 12-2023 | TTM |
---|---|---|---|---|---|---|---|---|---|---|
Debt FCF | 12.67 | 7.88 | 9.61 | 11.16 | 8.51 | 9.33 | 9.02 | 26.48 | 8.17 | 6.43 |
Debt Equity | 3.02 | 2.65 | 2.83 | 3.00 | 2.78 | 2.69 | 2.56 | 2.52 | 2.02 | 1.96 |
MIN | ||||||||||
Graham Stability | - | - | 68% | 100% | 100% | 74% | 100% | 91% | 100% | 68% |
The Debt/FCF trailing twelve month is 6.43.
The trend of Debt/FCF over the past 5 years is 1.10.
Graham’s Stability measure stands at 0.68.
Growth can be dangerous when forecasting, simply projecting the current growth is in general wrong. A company passes through multiple phases, from being young and unprofitable, to the first periods of profitability and high growth, until it arrives at a period of regime with limited growth. Identifying in which phase the company is in may help forecasting.
Years | 12-2016 | 12-2018 | 12-2020 | 12-2022 | Trend |
---|---|---|---|---|---|
Revenue | 3.4% | 2% | 12% | 6.1% | 1.4% |
Net Income | 30% | 5.2% | 30% | 40% | -16% |
Stockholders Equity | 5% | 6.2% | 6.2% | 18% | 0.34% |
FCF | 0.48% | 4.4% | 0.79% | 210% | -14% |
The Revenue CAGR over the past 5 years is +2%.
The trend of Revenue growth rate over the past 5 years is +1.36%.
The Earnings CAGR over the past 5 years is +5.24%.
The trend of Earnings growth rate over the past 5 years is -16.38%.
The Equity CAGR over the past 5 years is +6.23%.
The trend of Equity growth rate over the past 5 years is +0.34%.
The FCF CAGR over the past 5 years is +4.4%.
The trend of FCF growth rate over the past 5 years is -14.23%.