CABOT CORP (CBT) Stock Fundamental Analysis
NYSE:CBT - New York Stock Exchange, Inc. - US1270551013 - Common Stock - Currency: USD
Taking everything into account, CBT scores 7 out of 10 in our fundamental rating. CBT was compared to 85 industry peers in the Chemicals industry. Both the health and profitability get an excellent rating, making CBT a very profitable company, without any liquidiy or solvency issues. CBT may be a bit undervalued, certainly considering the very reasonable score on growth CBT also has an excellent dividend rating. These ratings would make CBT suitable for value and dividend and quality investing!
1. Profitability
1.1 Basic Checks
CBT had positive earnings in the past year.
CBT had a positive operating cash flow in the past year.
Of the past 5 years CBT 4 years were profitable.
In the past 5 years CBT always reported a positive cash flow from operatings.
1.2 Ratios
CBT has a Return On Assets of 11.45%. This is amongst the best in the industry. CBT outperforms 96.39% of its industry peers.
Looking at the Return On Equity, with a value of 30.53%, CBT belongs to the top of the industry, outperforming 96.39% of the companies in the same industry.
CBT has a Return On Invested Capital of 16.70%. This is amongst the best in the industry. CBT outperforms 98.80% of its industry peers.
The Average Return On Invested Capital over the past 3 years for CBT is significantly above the industry average of 6.65%.
The last Return On Invested Capital (16.70%) for CBT is above the 3 year average (15.53%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.45% | ||
| ROE | 30.53% | ||
| ROIC | 16.7% |
ROA(3y)9.33%
ROA(5y)5.38%
ROE(3y)27.92%
ROE(5y)15.08%
ROIC(3y)15.53%
ROIC(5y)14.15%
1.3 Margins
With an excellent Profit Margin value of 10.45%, CBT belongs to the best of the industry, outperforming 87.95% of the companies in the same industry.
In the last couple of years the Profit Margin of CBT has grown nicely.
The Operating Margin of CBT (15.86%) is better than 84.34% of its industry peers.
CBT's Operating Margin has improved in the last couple of years.
CBT's Gross Margin of 24.48% is in line compared to the rest of the industry. CBT outperforms 45.78% of its industry peers.
CBT's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.86% | ||
| PM (TTM) | 10.45% | ||
| GM | 24.48% |
OM growth 3Y4.07%
OM growth 5Y7.89%
PM growth 3Y8.93%
PM growth 5Y15.05%
GM growth 3Y0.55%
GM growth 5Y2.94%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), CBT is creating value.
CBT has less shares outstanding than it did 1 year ago.
CBT has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, CBT has an improved debt to assets ratio.
2.2 Solvency
CBT has an Altman-Z score of 3.82. This indicates that CBT is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 3.82, CBT belongs to the best of the industry, outperforming 83.13% of the companies in the same industry.
CBT has a debt to FCF ratio of 2.68. This is a good value and a sign of high solvency as CBT would need 2.68 years to pay back of all of its debts.
CBT has a better Debt to FCF ratio (2.68) than 86.75% of its industry peers.
CBT has a Debt/Equity ratio of 0.87. This is a neutral value indicating CBT is somewhat dependend on debt financing.
CBT's Debt to Equity ratio of 0.87 is on the low side compared to the rest of the industry. CBT is outperformed by 62.65% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.87 | ||
| Debt/FCF | 2.68 | ||
| Altman-Z | 3.82 |
ROIC/WACC1.86
WACC8.98%
2.3 Liquidity
CBT has a Current Ratio of 2.00. This indicates that CBT is financially healthy and has no problem in meeting its short term obligations.
Looking at the Current ratio, with a value of 2.00, CBT is in line with its industry, outperforming 48.19% of the companies in the same industry.
CBT has a Quick Ratio of 1.29. This is a normal value and indicates that CBT is financially healthy and should not expect problems in meeting its short term obligations.
CBT has a Quick ratio of 1.29. This is comparable to the rest of the industry: CBT outperforms 48.19% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2 | ||
| Quick Ratio | 1.29 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 21.81% over the past year.
Measured over the past years, CBT shows a quite strong growth in Earnings Per Share. The EPS has been growing by 12.54% on average per year.
The Revenue has been growing slightly by 1.71% in the past year.
The Revenue has been growing slightly by 3.66% on average over the past years.
EPS 1Y (TTM)21.81%
EPS 3Y12.04%
EPS 5Y12.54%
EPS Q2Q%12.82%
Revenue 1Y (TTM)1.71%
Revenue growth 3Y5.42%
Revenue growth 5Y3.66%
Sales Q2Q%-0.31%
3.2 Future
Based on estimates for the next years, CBT will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.39% on average per year.
CBT is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.55% yearly.
EPS Next Y7.83%
EPS Next 2Y8.97%
EPS Next 3Y9.39%
EPS Next 5YN/A
Revenue Next Year2.94%
Revenue Next 2Y3.34%
Revenue Next 3Y3.55%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 11.63, the valuation of CBT can be described as very reasonable.
Based on the Price/Earnings ratio, CBT is valued cheaply inside the industry as 86.75% of the companies are valued more expensively.
Compared to an average S&P500 Price/Earnings ratio of 29.63, CBT is valued rather cheaply.
With a Price/Forward Earnings ratio of 10.08, the valuation of CBT can be described as very reasonable.
CBT's Price/Forward Earnings ratio is rather cheap when compared to the industry. CBT is cheaper than 85.54% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of CBT to the average of the S&P500 Index (22.68), we can say CBT is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.63 | ||
| Fwd PE | 10.08 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of CBT indicates a rather cheap valuation: CBT is cheaper than 85.54% of the companies listed in the same industry.
83.13% of the companies in the same industry are more expensive than CBT, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.25 | ||
| EV/EBITDA | 7.12 |
4.3 Compensation for Growth
CBT's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of CBT may justify a higher PE ratio.
PEG (NY)1.49
PEG (5Y)0.93
EPS Next 2Y8.97%
EPS Next 3Y9.39%
5. Dividend
5.1 Amount
CBT has a Yearly Dividend Yield of 2.01%.
In the last 3 months the price of CBT has falen by -23.46%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
Compared to an average industry Dividend Yield of 3.28, CBT pays a bit more dividend than its industry peers.
CBT's Dividend Yield is comparable with the S&P500 average which is at 2.27.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.01% |
5.2 History
The dividend of CBT has a limited annual growth rate of 4.51%.
CBT has been paying a dividend for at least 10 years, so it has a reliable track record.
CBT has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)4.51%
Div Incr Years13
Div Non Decr Years34
5.3 Sustainability
22.78% of the earnings are spent on dividend by CBT. This is a low number and sustainable payout ratio.
CBT's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP22.78%
EPS Next 2Y8.97%
EPS Next 3Y9.39%
84.47
-1.04 (-1.22%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryChemicals
Earnings (Last)
Earnings (Next)
Inst Owners99%
Inst Owner Change1.78%
Ins Owners1.14%
Ins Owner Change3.01%
Market Cap4.58B
Analysts73.33
Price Target107.1 (26.79%)
Short Float %4.28%
Short Ratio5.77
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.01% |
Yearly Dividend1.7
Dividend Growth(5Y)4.51%
DP22.78%
Div Incr Years13
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.52%
Min EPS beat(2)-1.41%
Max EPS beat(2)0.36%
EPS beat(4)3
Avg EPS beat(4)3.85%
Min EPS beat(4)-1.41%
Max EPS beat(4)10.27%
EPS beat(8)6
Avg EPS beat(8)2.62%
EPS beat(12)10
Avg EPS beat(12)4.54%
EPS beat(16)14
Avg EPS beat(16)8.23%
Revenue beat(2)0
Avg Revenue beat(2)-3.56%
Min Revenue beat(2)-5.16%
Max Revenue beat(2)-1.96%
Revenue beat(4)1
Avg Revenue beat(4)-2.49%
Min Revenue beat(4)-5.16%
Max Revenue beat(4)0.59%
Revenue beat(8)1
Avg Revenue beat(8)-4.25%
Revenue beat(12)5
Avg Revenue beat(12)-0.35%
Revenue beat(16)8
Avg Revenue beat(16)1.4%
PT rev (1m)-6.83%
PT rev (3m)-1.96%
EPS NQ rev (1m)-0.26%
EPS NQ rev (3m)-3.13%
EPS NY rev (1m)-1.47%
EPS NY rev (3m)-2.11%
Revenue NQ rev (1m)-3.82%
Revenue NQ rev (3m)-6.44%
Revenue NY rev (1m)-1.26%
Revenue NY rev (3m)-2%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.63 | ||
| Fwd PE | 10.08 | ||
| P/S | 1.15 | ||
| P/FCF | 10.25 | ||
| P/OCF | 6.44 | ||
| P/B | 3.35 | ||
| P/tB | 3.87 | ||
| EV/EBITDA | 7.12 |
EPS(TTM)7.26
EY8.59%
EPS(NY)8.38
Fwd EY9.92%
FCF(TTM)8.24
FCFY9.76%
OCF(TTM)13.11
OCFY15.52%
SpS73.61
BVpS25.19
TBVpS21.8
PEG (NY)1.49
PEG (5Y)0.93
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.45% | ||
| ROE | 30.53% | ||
| ROCE | 21.87% | ||
| ROIC | 16.7% | ||
| ROICexc | 17.79% | ||
| ROICexgc | 19.03% | ||
| OM | 15.86% | ||
| PM (TTM) | 10.45% | ||
| GM | 24.48% | ||
| FCFM | 11.2% |
ROA(3y)9.33%
ROA(5y)5.38%
ROE(3y)27.92%
ROE(5y)15.08%
ROIC(3y)15.53%
ROIC(5y)14.15%
ROICexc(3y)16.81%
ROICexc(5y)15.29%
ROICexgc(3y)18.1%
ROICexgc(5y)16.74%
ROCE(3y)21.12%
ROCE(5y)18.93%
ROICexcg growth 3Y-2.54%
ROICexcg growth 5Y6.98%
ROICexc growth 3Y-0.75%
ROICexc growth 5Y7.34%
OM growth 3Y4.07%
OM growth 5Y7.89%
PM growth 3Y8.93%
PM growth 5Y15.05%
GM growth 3Y0.55%
GM growth 5Y2.94%
F-Score6
Asset Turnover1.1
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.87 | ||
| Debt/FCF | 2.68 | ||
| Debt/EBITDA | 1.52 | ||
| Cap/Depr | 179.59% | ||
| Cap/Sales | 6.61% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 91.15% | ||
| Profit Quality | 107.19% | ||
| Current Ratio | 2 | ||
| Quick Ratio | 1.29 | ||
| Altman-Z | 3.82 |
F-Score6
WACC8.98%
ROIC/WACC1.86
Cap/Depr(3y)157.86%
Cap/Depr(5y)144.41%
Cap/Sales(3y)5.71%
Cap/Sales(5y)6.1%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)21.81%
EPS 3Y12.04%
EPS 5Y12.54%
EPS Q2Q%12.82%
EPS Next Y7.83%
EPS Next 2Y8.97%
EPS Next 3Y9.39%
EPS Next 5YN/A
Revenue 1Y (TTM)1.71%
Revenue growth 3Y5.42%
Revenue growth 5Y3.66%
Sales Q2Q%-0.31%
Revenue Next Year2.94%
Revenue Next 2Y3.34%
Revenue Next 3Y3.55%
Revenue Next 5YN/A
EBIT growth 1Y13.64%
EBIT growth 3Y9.71%
EBIT growth 5Y11.83%
EBIT Next Year30.15%
EBIT Next 3Y14.06%
EBIT Next 5YN/A
FCF growth 1Y3080%
FCF growth 3Y93.76%
FCF growth 5Y26.54%
OCF growth 1Y253.73%
OCF growth 3Y39.12%
OCF growth 5Y13.77%