Koppers Holdings Inc.

KOP

Lumber & Wood Products (No Furniture)

Mkt Cap

$883.5M

PE

11.52

Debt

$881.6M

Cash

$49M

EV

$1.716B

FCF

$32.7M

Market Cap

$883.5M

P/E Ratio

11.52

Debt

$881.6M

Cash

$49M

EV

$1.716B

FCF

$32.7M

Charts data: {"Earnings":[{"time":"2014-12-30","value":-39400000},{"time":"2015-12-30","value":-76000000},{"time":"2016-12-30","value":27700000},{"time":"2017-12-30","value":29100000},{"time":"2018-12-30","value":23400000},{"time":"2019-12-30","value":66600000},{"time":"2020-12-30","value":121000000},{"time":"2021-12-30","value":84900000},{"time":"2022-12-30","value":63200000},{"time":"2023-12-30","value":89200000}],"Sales":[{"time":"2014-12-30","value":1555000000},{"time":"2015-12-30","value":1626900000},{"time":"2016-12-30","value":1416200000},{"time":"2017-12-30","value":1475500000},{"time":"2018-12-30","value":1710200000},{"time":"2019-12-30","value":1772800000},{"time":"2020-12-30","value":1669100000},{"time":"2021-12-30","value":1678600000},{"time":"2022-12-30","value":1980500000},{"time":"2023-12-30","value":2154200000}],"Net Margins":[{"time":"2014-12-30","value":-0.025337620578778135},{"time":"2015-12-30","value":-0.046714610609133934},{"time":"2016-12-30","value":0.01955938426775879},{"time":"2017-12-30","value":0.019722128092172143},{"time":"2018-12-30","value":0.01368261022102678},{"time":"2019-12-30","value":0.03756768953068592},{"time":"2020-12-30","value":0.07249415852854832},{"time":"2021-12-30","value":0.05057786250446801},{"time":"2022-12-30","value":0.0319111335521333},{"time":"2023-12-30","value":0.04140748305635503}],"Assets":[{"time":"2014-12-30","value":1293900000},{"time":"2015-12-30","value":1125400000},{"time":"2016-12-30","value":1087500000},{"time":"2017-12-30","value":1200200000},{"time":"2018-12-30","value":1479900000},{"time":"2019-12-30","value":1564600000},{"time":"2020-12-30","value":1598600000},{"time":"2021-12-30","value":1661900000},{"time":"2022-12-30","value":1711400000},{"time":"2023-12-30","value":1835500000}],"Stockholders Equity":[{"time":"2014-12-30","value":83900000},{"time":"2015-12-30","value":-12400000},{"time":"2016-12-30","value":34600000},{"time":"2017-12-30","value":105800000},{"time":"2018-12-30","value":67000000},{"time":"2019-12-30","value":158700000},{"time":"2020-12-30","value":346000000},{"time":"2021-12-30","value":410800000},{"time":"2022-12-30","value":403000000},{"time":"2023-12-30","value":503000000}],"ROE":[{"time":"2014-12-30","value":-0.4696066746126341},{"time":"2015-12-30","value":6.129032258064516},{"time":"2016-12-30","value":0.8005780346820809},{"time":"2017-12-30","value":0.27504725897920607},{"time":"2018-12-30","value":0.3492537313432836},{"time":"2019-12-30","value":0.41965973534971646},{"time":"2020-12-30","value":0.34971098265895956},{"time":"2021-12-30","value":0.2066699123661149},{"time":"2022-12-30","value":0.15682382133995038},{"time":"2023-12-30","value":0.17733598409542745}],"ROA":[{"time":"2014-12-30","value":0.025658860808408686},{"time":"2015-12-30","value":-0.026301759374444643},{"time":"2016-12-30","value":0.07944827586206897},{"time":"2017-12-30","value":0.09340109981669721},{"time":"2018-12-30","value":0.07459963511048044},{"time":"2019-12-30","value":0.08359964208104308},{"time":"2020-12-30","value":0.09802327036156637},{"time":"2021-12-30","value":0.09416932426740478},{"time":"2022-12-30","value":0.08046044174360173},{"time":"2023-12-30","value":0.10634704440207028}]}

Koppers Holdings Inc. provides treated wood products, wood preservation chemicals, and carbon compounds in the United States, Australasia, Europe, and internationally. The company operates through three segments: Railroad and Utility Products and Services (RUPS), Performance Chemicals (PC), and Carbon Materials and Chemicals (CMC).The RUPS segment procures and treats crossties, switch ties, and various types of lumber used for railroad bridges and crossings. It also provides rail joint bars to join rails together for railroads; transmission and distribution poles for electric and telephone utilities; and pilings. This segment provides railroad services, such as engineering, design, repair, and inspection services for railroad bridges. The PC segment develops, manufactures, and markets copper-based wood preservatives, including micronized copper azole, micronized pigments, alkaline copper quaternary, amine copper azole, and chromated copper arsenate for decking, fencing, utility poles, construction lumber and timbers, and various agricultural uses; and supplies fire-retardant chemicals for pressure treatment of wood primarily in commercial construction. The CMC segment manufactures creosote for the treatment of wood or as a feedstock in the production of carbon black; carbon pitch, a raw material used in the production of aluminum and steel; naphthalene for use as a feedstock in the production of phthalic anhydride and as a surfactant in the production of concrete; phthalic anhydride for the production of plasticizers, polyester resins, and alkyd paints; and carbon black feedstock for use in the production of carbon black. It serves the railroad, specialty chemical, utility, residential lumber, agriculture, aluminum, steel, rubber, and construction industries. Koppers Holdings Inc. was founded in 1988 and is headquartered in Pittsburgh, Pennsylvania.

Sector

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

DCF

Discounted Cash Flow Valuation of Koppers Holdings Inc.

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	$32.7M	$30.16M	$27.81M	$25.65M	$23.66M	$21.82M	$20.12M	$18.56M	$17.11M	$15.78M	$14.55M	$145.5M
DCF		$26.22M	$21.03M	$16.87M	$13.53M	$10.85M	$8.698M	$6.976M	$5.594M	$4.486M	$3.598M	$35.98M
Value	$153.8M

Chart P/E ratio

In the chart Earnings are multiplied by this value.

Earnings Growth 21%

Earnings Stability 28%

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 too low to guarantee profitability in case of higher costs or higher interest rates. Furthermore lower margins cause higher earnings’ volatility.

Over time the ROA has been increasing indicating a higher marginal ROA with respect to the calculated one, giving a good sign for continued growth.

Years	12-2015	12-2016	12-2017	12-2018	12-2019	12-2020	12-2021	12-2022	12-2023	TTM
Net Margin	-4.7%	2%	2%	1.4%	3.8%	7.2%	5.1%	3.2%	4.1%	3.6%
ROA	-2.6%	7.9%	9.3%	7.5%	8.4%	9.8%	9.4%	8%	11%	9.7%
ROE	610%	80%	28%	35%	42%	35%	21%	16%	18%	15%

What is the average Net Margin?

The average Net Margin over the past 5 years is +4.13%.

What is the trend of Net Margin?

The trend of Net Margin over the past 5 years is +0.28%.

What is the average Return on Assets (ROA)?

The average ROA over the past 5 years is +8.95%.

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

The trend of ROA over the past 5 years is +0.42%.

What is the average Return on Equity (ROE)?

The average ROE over the past 5 years is +27.66%.

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

The trend of ROE over the past 5 years is -5.12%.

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.

The company has high debt with respect to the cashflow it generates.

The Graham’s stability indicate a relevant drawdown, consider checking when it has occured and why.

Years	12-2015	12-2016	12-2017	12-2018	12-2019	12-2020	12-2021	12-2022	12-2023	TTM
Debt FCF	8.90	10.25	20.41	-32.30	11.81	13.86	-35.96	-275.10	33.80	26.96
Debt Equity	-62.48	20.63	6.62	15.14	5.81	2.30	1.93	2.05	1.72	1.73
MIN
Graham Stability	-	-	-	-	100%	100%	100%	70%	99%	70%

What is the Debt/FCF?

The Debt/FCF trailing twelve month is 26.96.

What is the trend of Debt/FCF?

The trend of Debt/FCF over the past 5 years is -16.57.

What is the Graham’s Stability?

Graham’s Stability measure stands at 0.70.

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	6.2%	4.7%	8.9%	8.8%	1.3%
Net Income	18%	31%	-9.7%	41%	-4.2%
Stockholders Equity	47%	50%	13%	25%	-21%
FCF	-13%	-	-24%	-	0.58%

What is the 5 year Revenue CAGR?

The Revenue CAGR over the past 5 years is +4.72%.

What is the trend of Revenue growth?

The trend of Revenue growth rate over the past 5 years is +1.34%.

What is the 5 year Earnings CAGR?

The Earnings CAGR over the past 5 years is +30.69%.

What is the trend of Earnings growth?

The trend of Earnings growth rate over the past 5 years is -4.22%.

What is the 5 year Equity CAGR?

The Equity CAGR over the past 5 years is +49.66%.

What is the trend of Equity growth?

The trend of Equity growth rate over the past 5 years is -21.12%.

What is the 5 year FCF CAGR?

The FCF CAGR over the past 5 years is -.

What is the trend of FCF growth?

The trend of FCF growth rate over the past 5 years is +0.58%.