One-glance verdict
Overvalued
$21.87 our estimate vs market $34.20
Wall Street consensus: $36.21 (65.6% higher than our fair-value estimate)
56% above our estimate, beyond the bull case
Fundamentals snapshot
Axalta Coating Systems Ltd.
AXTA · NYQ · Basic Materials · Specialty Chemicals
Current price
$34.20
52-week range
$24.94 - $35.72
Market cap
$7.32B
Balance sheet
Stretched
4.18x Stretched
Net debt $2.54B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
1 Risk
3 rewards · 1 risks
- Reward Returns 16.2% on equity, ahead of 50% of its peers.
- Reward Free cash flow was positive in 10/10 years.
- Reward Trades at 20.0x P/E vs peer median 20.4x (1.8% cheaper).
- Risk Insider ownership is only 0.4% (peer median: 0.9%).
What this company does
Axalta Coating Systems Ltd.
Axalta Coating Systems makes the specialized paints and protective coatings used on cars, trucks, and industrial products like furniture and building materials. The company's main customers are vehicle manufacturers and auto repair shops, along with businesses in the construction and general industrial sectors. Because these coatings are essential for making and maintaining so many large-scale goods, Axalta's sales can provide a window into the health of the global manufacturing economy.
How the company got here
Axalta's roots go back to 1866 with companies that made coatings for horse-drawn carriages in Germany. For much of its life, it was the performance coatings division of the chemical giant DuPont. A major turning point came in 2013 when the private equity firm The Carlyle Group bought the division from DuPont and renamed it Axalta Coating Systems. The company then had its initial public offering (IPO), which is when a private company first sells shares of stock to the public, in 2014.
What it actually does
Axalta makes and sells high-performance liquid and powder coatings, which you can think of as specialized paints and finishes. These coatings are used to protect surfaces and make them look good, serving everything from cars and trucks to industrial equipment like pipelines and even furniture. The company provides the colorful, protective layers you see on new vehicles rolling out of a factory and also sells the paint systems that auto body shops use to repair and repaint damaged cars. Essentially, they create the durable and beautiful finishes on many products you see and use every day.
Performance Coatings
This is Axalta's largest business segment, making up about two-thirds of its sales. It serves two main groups: auto repair shops and a wide range of industrial customers. For auto body shops, it provides refinishing paints, color-matching tools, and other products needed to make a damaged vehicle look new again. For industrial clients, it creates specialized liquid and powder coatings for things like building materials, furniture, and heavy machinery like construction equipment to protect them from corrosion and wear.
Mobility Coatings
This segment, which accounts for the other third of the company's business, sells coatings directly to original equipment manufacturers (OEMs), which are the companies that make brand-name products. Its customers are the big car and truck manufacturers like Ford, GM, or Toyota. Axalta provides the factory-applied coatings for new light vehicles (cars, SUVs, light trucks) and commercial vehicles (heavy-duty trucks, buses, and trains). These coatings are developed to meet the precise specifications of the automakers for durability, color, and application efficiency on the assembly line.
What management is betting on now
The company has a strategic plan focused on accelerating its performance through 2026. A key part of this plan is what they call an "optimized portfolio strategy," which involves focusing on their most profitable products and services. They are also emphasizing operational excellence, which means making their manufacturing and supply chain (the network to get products from the factory to the customer) more efficient. Finally, Axalta is focused on sustainable innovation, which involves developing new, environmentally friendly products and solutions for its customers.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q2
$91.00M
FY2024 Q3
$161.00M
FY2024 Q4
$172.00M
FY2025 Q1
$-17.00M
FY2025 Q2
$97.00M
FY2025 Q3
$87.00M
FY2025 Q4
$286.00M
FY2026 Q1
$18.00M
Revenue
$1.25B
Net income
$90.00M
Diluted EPS
0.42
Operating cash flow
$68.00M
Free cash flow
$18.00M
Fetching…
Sources
Revenue
$1.26B
Net income
$60.00M
Diluted EPS
0.28
Operating cash flow
$344.00M
Free cash flow
$286.00M
Fetching…
Sources
Revenue
$1.29B
Net income
$110.00M
Diluted EPS
0.51
Operating cash flow
$137.00M
Free cash flow
$87.00M
Fetching…
Sources
Revenue
$1.30B
Net income
$109.00M
Diluted EPS
0.50
Operating cash flow
$142.00M
Free cash flow
$97.00M
Fetching…
Sources
Revenue
$1.26B
Net income
$99.00M
Diluted EPS
0.45
Operating cash flow
$26.00M
Free cash flow
$-17.00M
Fetching…
Sources
Revenue
$1.31B
Net income
$137.00M
Diluted EPS
0.63
Operating cash flow
$234.00M
Free cash flow
$172.00M
Fetching…
Sources
Revenue
$1.32B
Net income
$101.00M
Diluted EPS
0.46
Operating cash flow
$194.00M
Free cash flow
$161.00M
Fetching…
Sources
Revenue
$1.35B
Net income
$112.00M
Diluted EPS
0.51
Operating cash flow
$114.00M
Free cash flow
$91.00M
Fetching…
Sources
Is it cheap or expensive?
Fair value $21.87 vs current price $34.20
Wall Street consensus is the average analyst price target: $36.21 (65.6% higher than our fair-value estimate).
Our most-likely fair value is $21.87 a share — about 36.1% below today's price of $34.20, so the stock currently looks expensive (overvalued).
Is it drowning in debt?
Stretched
Net debt $2.5B. Interest coverage 4.2x.
Net debt
$2.54B
Interest coverage
4.18x
Axalta Coating Systems Ltd.'s profit covers its interest bill about 4.2 times over. which is stronger than most peers shown here and 1 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Stretched
Worse cushion
Baseline
Better cushion
AXTA
BASELINE
Axalta Coating Systems Ltd.
Total debt $3.15B Interest coverage 4.18x This is the baseline the peer rows are being compared against.
Total debt $2.90B Interest coverage 9.32x +123% vs AXTA Carries about 2.2x more debt cushion than AXTA.
Total debt $7.74B Interest coverage 9.00x +116% vs AXTA Carries about 2.2x more debt cushion than AXTA.
Total debt $5.45B Interest coverage 4.37x +5% vs AXTA Has roughly the same debt cushion as AXTA.
Total debt $6.38B Interest coverage -1.23x -100% vs AXTA This peer has almost no interest-payment cushion compared with AXTA.
Total debt $1.92B Interest coverage 2.06x -51% vs AXTA Carries about 2.0x less debt cushion than AXTA.
What you should know
The case for and against AXTA
3 Rewards
1 Risk
Rewards
-
Returns 16.2% on equity, ahead of 50% of its peers.
-
Free cash flow was positive in 10/10 years.
-
Trades at 20.0x P/E vs peer median 20.4x (1.8% cheaper).
Risks
-
Insider ownership is only 0.4% (peer median: 0.9%).
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
20.00x
Forward P/E
12.16x
P/B
3.02x
P/S
1.43x
EV/EBITDA
9.97x
PEG ratio
2.04x
Profitability
How much profit each dollar creates
Gross margin
34.2%
Operating margin
13.6%
Net margin
7.2%
ROE
16.2%
ROA
6.4%
Health
Liquidity and balance-sheet strength
Debt / equity
1.28x
Current ratio
2.10x
Quick ratio
1.36x
Total debt
$3.15B
Total cash
$609.00M
Growth
How the business has been compounding
Revenue TTM
$5.11B
Revenue 5Y CAGR
3.8%
EPS TTM
1.71
EPS 5Y CAGR
26.5%
Cash flow
How much cash the business throws off
Operating CF TTM
$691.00M
Free CF TTM
$453.00M
FCF margin
8.9%
Dividend
Shareholder payout
Yield
—
Payout ratio
0.0%
Last ex-div date
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