Balchem Corp

BCPC

Chemicals & Allied Products

Mkt Cap

$4.903B

PE

42.70

Debt

$17.04M

Cash

$60.35M

EV

$4.86B

FCF

$147.2M

Market Cap

$4.903B

P/E Ratio

42.70

Debt

$17.04M

Cash

$60.35M

EV

$4.86B

FCF

$147.2M

Charts data: {"Earnings":[{"time":"2014-12-30","value":52826000},{"time":"2015-12-30","value":59722000},{"time":"2016-12-30","value":55972000},{"time":"2017-12-30","value":90071000},{"time":"2018-12-30","value":78573000},{"time":"2019-12-30","value":79671000},{"time":"2020-12-30","value":84623000},{"time":"2021-12-30","value":96104000},{"time":"2022-12-30","value":105367000},{"time":"2023-12-30","value":108543000}],"Sales":[{"time":"2014-12-30","value":541383000},{"time":"2015-12-30","value":552492000},{"time":"2016-12-30","value":553204000},{"time":"2017-12-30","value":594790000},{"time":"2018-12-30","value":643679000},{"time":"2019-12-30","value":643705000},{"time":"2020-12-30","value":703644000},{"time":"2021-12-30","value":799023000},{"time":"2022-12-30","value":942358000},{"time":"2023-12-30","value":922439000}],"Net Margins":[{"time":"2014-12-30","value":0.09757602288952553},{"time":"2015-12-30","value":0.1080956828334166},{"time":"2016-12-30","value":0.10117786566980716},{"time":"2017-12-30","value":0.15143327897241043},{"time":"2018-12-30","value":0.12206860873199218},{"time":"2019-12-30","value":0.12376942854257773},{"time":"2020-12-30","value":0.12026394028798654},{"time":"2021-12-30","value":0.12027688814965276},{"time":"2022-12-30","value":0.11181207142084006},{"time":"2023-12-30","value":0.11766956947830697}],"Assets":[{"time":"2014-12-30","value":861271000},{"time":"2015-12-30","value":881223000},{"time":"2016-12-30","value":948626000},{"time":"2017-12-30","value":963636000},{"time":"2018-12-30","value":981355000},{"time":"2019-12-30","value":1155682000},{"time":"2020-12-30","value":1165843000},{"time":"2021-12-30","value":1199325000},{"time":"2022-12-30","value":1624512000},{"time":"2023-12-30","value":1597211000}],"Stockholders Equity":[{"time":"2014-12-30","value":391898000},{"time":"2015-12-30","value":463705000},{"time":"2016-12-30","value":521033000},{"time":"2017-12-30","value":616881000},{"time":"2018-12-30","value":691618000},{"time":"2019-12-30","value":743667000},{"time":"2020-12-30","value":828233000},{"time":"2021-12-30","value":877015000},{"time":"2022-12-30","value":938284000},{"time":"2023-12-30","value":1053984000}],"ROE":[{"time":"2014-12-30","value":0.1347952783632476},{"time":"2015-12-30","value":0.12879309043465134},{"time":"2016-12-30","value":0.10742505752994531},{"time":"2017-12-30","value":0.1460103326249309},{"time":"2018-12-30","value":0.11360751166106145},{"time":"2019-12-30","value":0.10713262791007265},{"time":"2020-12-30","value":0.10217293925743118},{"time":"2021-12-30","value":0.10958079394309106},{"time":"2022-12-30","value":0.11229755596386595},{"time":"2023-12-30","value":0.10298353675198106}],"ROA":[{"time":"2014-12-30","value":0.09543686017525262},{"time":"2015-12-30","value":0.10662000424410166},{"time":"2016-12-30","value":0.09575744287000357},{"time":"2017-12-30","value":0.10092503808492004},{"time":"2018-12-30","value":0.10979818720035053},{"time":"2019-12-30","value":0.08873807846795226},{"time":"2020-12-30","value":0.09533616447497648},{"time":"2021-12-30","value":0.10631146686677923},{"time":"2022-12-30","value":0.08937206988929598},{"time":"2023-12-30","value":0.09966936115516359}]}

Balchem Corporation develops, manufactures, and markets specialty performance ingredients and products for the nutritional, food, pharmaceutical, animal health, medical device sterilization, plant nutrition, and industrial markets in the United States and internationally. It operates through three segments: Human Nutrition and Health, Animal Nutrition and Health, and Specialty Products. The Human Nutrition & Health segment supplies ingredients in the food and beverage industry. Its products include spray dried and emulsified powders, extrusion and agglomeration, blended lipid systems, liquid flavor delivery systems, juice and dairy bases, chocolate systems, and cereal systems, as well as ice cream bases and variegates. This segment also offers microencapsulation solutions for various applications; and human grade choline nutrients and mineral amino acid chelated products for nutrition and health applications. The Animal Nutrition & Health segment provides microencapsulated products to enhance health and milk production, and delivering nutrient supplements in ruminant animals; chelation technology, which offers enhanced nutrient absorption for various species of production and companion animals; and choline chloride, a nutrient for monogastric animal health. The Specialty Products segment offers ethylene oxide primarily for use in the health care industry; single use canisters for sterilizing re-usable devices; and ammonia. This segment also markets and sells propylene oxide, a fumigant to aid in the control of insects and microbiological spoilage, as well as to reduce bacterial and mold contamination in shell and processed nut meats, processed spices, cacao beans, cocoa powder, raisins, figs, and prunes; and chelated minerals for high value crops. The company sells its products through sales force, independent distributors, and sales agents. Balchem Corporation was incorporated in 1967 and is headquartered in Montvale, New Jersey.

Sector

10-Q
9/30/23
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10-K
12/31/22
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3/31/22
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12/31/19
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10-K
12/31/18
10-Q
9/30/18
10-Q
6/30/18
10-Q
3/31/18
10-K
12/31/17

DCF

Discounted Cash Flow Valuation of Balchem Corp

Calculate

Growth Years

Growth

Start

End

Discount

Start

End

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	$147.2M	$157.2M	$167.5M	$178.2M	$189.3M	$200.6M	$212.2M	$224.1M	$236.1M	$248.4M	$260.8M	$2.608B
DCF		$136.7M	$126.7M	$117.2M	$108.2M	$99.73M	$91.74M	$84.23M	$77.2M	$70.62M	$64.48M	$644.8M
Value	$1.622B

Chart P/E ratio

In the chart Earnings are multiplied by this value.

Earnings Growth 7.8%

Earnings Stability 76%

Competitiveness and MOAT

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.

The Net Margin is high enough to offer a good protection on the profits in case of higher costs or higher interests. Furthermore higher margins reduce earnings’ volatility.

Over time the ROA has been decreasing indicating a lower marginal ROA with respect to the calculated one, this could impede growth.

Years	12-2015	12-2016	12-2017	12-2018	12-2019	12-2020	12-2021	12-2022	12-2023	TTM
Net Margin	11%	10%	15%	12%	12%	12%	12%	11%	12%	12%
ROA	11%	9.6%	10%	11%	8.9%	9.5%	11%	8.9%	10%	10%
ROE	13%	11%	15%	11%	11%	10%	11%	11%	10%	11%

What is the average Net Margin?

The average Net Margin over the past 5 years is +11.93%.

What is the trend of Net Margin?

The trend of Net Margin over the past 5 years is -0.17%.

What is the average Return on Assets (ROA)?

The average ROA over the past 5 years is +9.82%.

What is the trend of Return on Assets (ROA)?

The trend of ROA over the past 5 years is -0.11%.

What is the average Return on Equity (ROE)?

The average ROE over the past 5 years is +10.8%.

What is the trend of Return on Equity (ROE)?

The trend of ROE over the past 5 years is -0.09%.

Safety & Stabiliy

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.

Under the assumption that FCF does not diminish and debt does not increase, the current years to repay the debt are acceptable.

The Graham’s stability indicate reliability of earnings, and consideration about the future are more dependable.

Years	12-2015	12-2016	12-2017	12-2018	12-2019	12-2020	12-2021	12-2022	12-2023	TTM
Debt FCF	4.76	3.09	2.65	1.58	0.11	0.09	0.11	0.30	0.11	0.12
Debt Equity	0.64	0.50	0.35	0.23	0.01	0.01	0.02	0.03	0.02	0.02
MIN
Graham Stability	-	-	100%	100%	100%	100%	100%	100%	100%	100%

What is the Debt/FCF?

The Debt/FCF trailing twelve month is 0.12.

What is the trend of Debt/FCF?

The trend of Debt/FCF over the past 5 years is -0.19.

What is the Graham’s Stability?

Graham’s Stability measure stands at 1.00.

Growth

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.

Earnings growth has not been increasing in the past years.

Years	12-2016	12-2018	12-2020	12-2022	Trend
Revenue	7.6%	7.5%	9.4%	-2.1%	0.83%
Net Income	9.9%	6.7%	8.7%	3%	-1.1%
Stockholders Equity	11%	8.8%	8.4%	12%	-1.1%
FCF	8.1%	8.1%	7.7%	65%	2.4%

What is the 5 year Revenue CAGR?

The Revenue CAGR over the past 5 years is +7.46%.

What is the trend of Revenue growth?

The trend of Revenue growth rate over the past 5 years is +0.83%.

What is the 5 year Earnings CAGR?

The Earnings CAGR over the past 5 years is +6.68%.

What is the trend of Earnings growth?

The trend of Earnings growth rate over the past 5 years is -1.14%.

What is the 5 year Equity CAGR?

The Equity CAGR over the past 5 years is +8.79%.

What is the trend of Equity growth?

The trend of Equity growth rate over the past 5 years is -1.1%.

What is the 5 year FCF CAGR?

The FCF CAGR over the past 5 years is +8.07%.

What is the trend of FCF growth?

The trend of FCF growth rate over the past 5 years is +2.35%.