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SOL SPA (SOL.MI) Stock Fundamental Analysis

BIT:SOL - Borsa Italiana Milan - IT0001206769 - Common Stock - Currency: EUR

39.75  +0.5 (+1.27%)

Fundamental Rating

6

We assign a fundamental rating of 6 out of 10 to SOL. SOL was compared to 60 industry peers in the Chemicals industry. SOL has an excellent profitability rating, but there are some minor concerns on its financial health. SOL has a decent growth rate and is not valued too expensively.


Dividend Valuation Growth Profitability Health

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9

1. Profitability

1.1 Basic Checks

In the past year SOL was profitable.
In the past year SOL had a positive cash flow from operations.
In the past 5 years SOL has always been profitable.
In the past 5 years SOL always reported a positive cash flow from operatings.
SOL.MI Yearly Net Income VS EBIT VS OCF VS FCFSOL.MI Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 50M 100M 150M 200M 250M

1.2 Ratios

The Return On Assets of SOL (6.87%) is better than 82.46% of its industry peers.
With an excellent Return On Equity value of 14.59%, SOL belongs to the best of the industry, outperforming 85.96% of the companies in the same industry.
SOL has a Return On Invested Capital of 10.22%. This is amongst the best in the industry. SOL outperforms 89.47% of its industry peers.
SOL had an Average Return On Invested Capital over the past 3 years of 9.69%. This is above the industry average of 6.58%.
The last Return On Invested Capital (10.22%) for SOL is above the 3 year average (9.69%), which is a sign of increasing profitability.
Industry RankSector Rank
ROA 6.87%
ROE 14.59%
ROIC 10.22%
ROA(3y)7.16%
ROA(5y)6.54%
ROE(3y)14.94%
ROE(5y)13.96%
ROIC(3y)9.69%
ROIC(5y)9.02%
SOL.MI Yearly ROA, ROE, ROICSOL.MI Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 5 10 15

1.3 Margins

Looking at the Profit Margin, with a value of 9.21%, SOL belongs to the top of the industry, outperforming 82.46% of the companies in the same industry.
SOL's Profit Margin has improved in the last couple of years.
SOL has a Operating Margin of 15.10%. This is amongst the best in the industry. SOL outperforms 87.72% of its industry peers.
SOL's Operating Margin has improved in the last couple of years.
With an excellent Gross Margin value of 74.67%, SOL belongs to the best of the industry, outperforming 98.25% of the companies in the same industry.
In the last couple of years the Gross Margin of SOL has remained more or less at the same level.
Industry RankSector Rank
OM 15.1%
PM (TTM) 9.21%
GM 74.67%
OM growth 3Y2.31%
OM growth 5Y6.98%
PM growth 3Y-2.53%
PM growth 5Y9.5%
GM growth 3Y-2.29%
GM growth 5Y-1.18%
SOL.MI Yearly Profit, Operating, Gross MarginsSOL.MI Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 20 40 60

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6

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so SOL is still creating some value.
Compared to 1 year ago, SOL has about the same amount of shares outstanding.
Compared to 5 years ago, SOL has about the same amount of shares outstanding.
SOL has a worse debt/assets ratio than last year.
SOL.MI Yearly Shares OutstandingSOL.MI Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 20M 40M 60M 80M
SOL.MI Yearly Total Debt VS Total AssetsSOL.MI Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 500M 1B 1.5B

2.2 Solvency

An Altman-Z score of 3.94 indicates that SOL is not in any danger for bankruptcy at the moment.
SOL has a better Altman-Z score (3.94) than 89.47% of its industry peers.
The Debt to FCF ratio of SOL is 9.11, which is on the high side as it means it would take SOL, 9.11 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 9.11, SOL is in the better half of the industry, outperforming 64.91% of the companies in the same industry.
SOL has a Debt/Equity ratio of 0.65. This is a neutral value indicating SOL is somewhat dependend on debt financing.
SOL's Debt to Equity ratio of 0.65 is on the low side compared to the rest of the industry. SOL is outperformed by 70.18% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.65
Debt/FCF 9.11
Altman-Z 3.94
ROIC/WACC1.33
WACC7.7%
SOL.MI Yearly LT Debt VS Equity VS FCFSOL.MI Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 200M 400M 600M 800M

2.3 Liquidity

SOL has a Current Ratio of 2.09. This indicates that SOL is financially healthy and has no problem in meeting its short term obligations.
The Current ratio of SOL (2.09) is better than 63.16% of its industry peers.
A Quick Ratio of 1.83 indicates that SOL should not have too much problems paying its short term obligations.
SOL's Quick ratio of 1.83 is fine compared to the rest of the industry. SOL outperforms 78.95% of its industry peers.
Industry RankSector Rank
Current Ratio 2.09
Quick Ratio 1.83
SOL.MI Yearly Current Assets VS Current LiabilitesSOL.MI Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 200M 400M 600M 800M

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4

3. Growth

3.1 Past

The earnings per share for SOL have decreased by -5.09% in the last year.
The Earnings Per Share has been growing by 22.95% on average over the past years. This is a very strong growth
The Revenue has been growing slightly by 5.10% in the past year.
SOL shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 12.28% yearly.
EPS 1Y (TTM)-5.09%
EPS 3Y12.26%
EPS 5Y22.95%
EPS Q2Q%-5.9%
Revenue 1Y (TTM)5.1%
Revenue growth 3Y15.16%
Revenue growth 5Y12.28%
Sales Q2Q%5.96%

3.2 Future

Based on estimates for the next years, SOL will show a small growth in Earnings Per Share. The EPS will grow by 7.91% on average per year.
The Revenue is expected to grow by 6.70% on average over the next years.
EPS Next Y48.15%
EPS Next 2Y26.56%
EPS Next 3Y19.58%
EPS Next 5Y7.91%
Revenue Next Year9.88%
Revenue Next 2Y29.27%
Revenue Next 3Y20.54%
Revenue Next 5Y6.7%

3.3 Evolution

The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
SOL.MI Yearly Revenue VS EstimatesSOL.MI Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 500M 1B 1.5B 2B 2.5B
SOL.MI Yearly EPS VS EstimatesSOL.MI Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 0.5 1 1.5 2 2.5

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5

4. Valuation

4.1 Price/Earnings Ratio

With a Price/Earnings ratio of 25.48, SOL can be considered very expensive at the moment.
The rest of the industry has a similar Price/Earnings ratio as SOL.
Compared to an average S&P500 Price/Earnings ratio of 28.47, SOL is valued at the same level.
A Price/Forward Earnings ratio of 15.17 indicates a correct valuation of SOL.
Based on the Price/Forward Earnings ratio, SOL is valued a bit cheaper than the industry average as 61.40% of the companies are valued more expensively.
When comparing the Price/Forward Earnings ratio of SOL to the average of the S&P500 Index (92.74), we can say SOL is valued rather cheaply.
Industry RankSector Rank
PE 25.48
Fwd PE 15.17
SOL.MI Price Earnings VS Forward Price EarningsSOL.MI Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 20 40 60 80

4.2 Price Multiples

SOL's Enterprise Value to EBITDA is on the same level as the industry average.
SOL's Price/Free Cash Flow is on the same level as the industry average.
Industry RankSector Rank
P/FCF 49.75
EV/EBITDA 10.25
SOL.MI Per share dataSOL.MI EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 5 10 15

4.3 Compensation for Growth

The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The excellent profitability rating of SOL may justify a higher PE ratio.
SOL's earnings are expected to grow with 19.58% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.53
PEG (5Y)1.11
EPS Next 2Y26.56%
EPS Next 3Y19.58%

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3

5. Dividend

5.1 Amount

SOL has a yearly dividend return of 0.95%, which is pretty low.
SOL's Dividend Yield is slightly below the industry average, which is at 3.94.
Compared to an average S&P500 Dividend Yield of 2.28, SOL's dividend is way lower than the S&P500 average.
Industry RankSector Rank
Dividend Yield 0.95%

5.2 History

On average, the dividend of SOL grows each year by 17.52%, which is quite nice.
Dividend Growth(5Y)17.52%
Div Incr Years0
Div Non Decr Years0

5.3 Sustainability

SOL pays out 26.83% of its income as dividend. This is a sustainable payout ratio.
The dividend of SOL is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP26.83%
EPS Next 2Y26.56%
EPS Next 3Y19.58%
SOL.MI Yearly Income VS Free CF VS DividendSOL.MI Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2015 2016 2017 2018 2019 2020 2021 2022 2023 50M 100M
SOL.MI Dividend Payout.SOL.MI Dividend Payout, showing the Payout Ratio.SOL.MI Dividend Payout.PayoutRetained Earnings

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SOL SPA

BIT:SOL (2/5/2025, 5:35:30 PM)

39.75

+0.5 (+1.27%)

Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryChemicals
Earnings (Last)11-14 2024-11-14
Earnings (Next)N/A N/A
Inst Owners20.14%
Inst Owner ChangeN/A
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap3.61B
Analysts83.33
Price Target42.84 (7.77%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield 0.95%
Yearly Dividend0.37
Dividend Growth(5Y)17.52%
DP26.83%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)N/A
Avg EPS beat(2)N/A
Min EPS beat(2)N/A
Max EPS beat(2)N/A
EPS beat(4)N/A
Avg EPS beat(4)N/A
Min EPS beat(4)N/A
Max EPS beat(4)N/A
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)N/A
Avg Revenue beat(2)N/A
Min Revenue beat(2)N/A
Max Revenue beat(2)N/A
Revenue beat(4)N/A
Avg Revenue beat(4)N/A
Min Revenue beat(4)N/A
Max Revenue beat(4)N/A
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)0%
PT rev (3m)10.53%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)42.86%
EPS NY rev (3m)42.86%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)-0.55%
Revenue NY rev (3m)-0.55%
Valuation
Industry RankSector Rank
PE 25.48
Fwd PE 15.17
P/S 2.35
P/FCF 49.75
P/OCF 12.15
P/B 3.73
P/tB 5.4
EV/EBITDA 10.25
EPS(TTM)1.56
EY3.92%
EPS(NY)2.62
Fwd EY6.59%
FCF(TTM)0.8
FCFY2.01%
OCF(TTM)3.27
OCFY8.23%
SpS16.88
BVpS10.66
TBVpS7.37
PEG (NY)0.53
PEG (5Y)1.11
Profitability
Industry RankSector Rank
ROA 6.87%
ROE 14.59%
ROCE 14.19%
ROIC 10.22%
ROICexc 11.83%
ROICexgc 14.88%
OM 15.1%
PM (TTM) 9.21%
GM 74.67%
FCFM 4.73%
ROA(3y)7.16%
ROA(5y)6.54%
ROE(3y)14.94%
ROE(5y)13.96%
ROIC(3y)9.69%
ROIC(5y)9.02%
ROICexc(3y)11.02%
ROICexc(5y)10.67%
ROICexgc(3y)13.69%
ROICexgc(5y)13.15%
ROCE(3y)13.59%
ROCE(5y)12.57%
ROICexcg growth 3Y3.35%
ROICexcg growth 5Y7.88%
ROICexc growth 3Y2.03%
ROICexc growth 5Y6.41%
OM growth 3Y2.31%
OM growth 5Y6.98%
PM growth 3Y-2.53%
PM growth 5Y9.5%
GM growth 3Y-2.29%
GM growth 5Y-1.18%
F-Score5
Asset Turnover0.75
Health
Industry RankSector Rank
Debt/Equity 0.65
Debt/FCF 9.11
Debt/EBITDA 1.64
Cap/Depr 148.71%
Cap/Sales 14.64%
Interest Coverage 4.57
Cash Conversion 77.66%
Profit Quality 51.38%
Current Ratio 2.09
Quick Ratio 1.83
Altman-Z 3.94
F-Score5
WACC7.7%
ROIC/WACC1.33
Cap/Depr(3y)130.14%
Cap/Depr(5y)134.49%
Cap/Sales(3y)12.91%
Cap/Sales(5y)14.26%
Profit Quality(3y)43.85%
Profit Quality(5y)48.43%
High Growth Momentum
Growth
EPS 1Y (TTM)-5.09%
EPS 3Y12.26%
EPS 5Y22.95%
EPS Q2Q%-5.9%
EPS Next Y48.15%
EPS Next 2Y26.56%
EPS Next 3Y19.58%
EPS Next 5Y7.91%
Revenue 1Y (TTM)5.1%
Revenue growth 3Y15.16%
Revenue growth 5Y12.28%
Sales Q2Q%5.96%
Revenue Next Year9.88%
Revenue Next 2Y29.27%
Revenue Next 3Y20.54%
Revenue Next 5Y6.7%
EBIT growth 1Y6.1%
EBIT growth 3Y17.81%
EBIT growth 5Y20.11%
EBIT Next Year90.43%
EBIT Next 3Y28.61%
EBIT Next 5Y24.32%
FCF growth 1Y216.39%
FCF growth 3Y-3.36%
FCF growth 5Y14.32%
OCF growth 1Y71.22%
OCF growth 3Y8.72%
OCF growth 5Y15.29%