One-glance verdict
Undervalued
$98.34 our estimate vs market $67.13
Wall Street consensus: $89.00 (-9.5% lower than our fair-value estimate)
32% below our estimate, below the bear case
Fundamentals snapshot
Ingevity Corporation
NGVT · NYQ · Basic Materials · Specialty Chemicals
Current price
$67.13
52-week range
$45.85 - $79.29
Market cap
$2.31B
Balance sheet
Distressed
3.40x Stretched
Net debt $1.14B. Interest coverage shows how many times profit covers the interest bill.
What stands out
2 Rewards
2 Risks
2 rewards · 2 risks
- Reward Returns 30.1% on equity, ahead of 83% of its peers.
- Reward Free cash flow was positive in 10/10 years.
- Risk Stock trades 638.2% above its 5-year average P/E.
- Risk Insider ownership is only 0.8% (peer median: 1.3%).
What this company does
Ingevity Corporation
Ingevity Corporation creates specialty chemicals and materials that other companies use as key ingredients for their own products. For instance, they make carbon-based materials that help control car emissions and chemicals used in building roads and making things like medical devices and bioplastics. The company makes money by selling these essential components to a wide range of industries, meaning its success is often linked to the general health of big sectors like automotive manufacturing and construction.
How the company got here
Ingevity was formed in 2016 when it was separated from a larger packaging company called WestRock. Its roots, however, go back much further, with some of its businesses having a legacy of over 90 years. The company's name itself is a blend of words like ingenuity, genuine, and longevity, reflecting its long history and focus on innovation. A key turning point was the acquisition of the Capa™ caprolactone business in 2019, which significantly expanded its offerings in advanced polymers. More recently, the company has been strategically reviewing its various businesses to focus on those that are most profitable.
What it actually does
Ingevity is a specialty chemicals company, which means it creates unique ingredients that other companies use to make their products better. You won't find Ingevity's name on a store shelf, but their science is in many things you use. For example, they make materials that go into cars to reduce gasoline vapor emissions, helping to protect the environment. They also create additives that make asphalt roads last longer and ingredients for things like adhesives, coatings, and even bioplastics.
Performance Materials
This part of the company is a leading producer of activated carbon, which is a material with a special ability to trap chemicals. Its main product is a honeycomb-like structure made of activated carbon that goes into the fuel systems of most cars, trucks, and motorcycles to capture harmful gasoline vapors before they escape into the air. This same carbon technology is also used to purify air, water, food, and beverages. This segment is a significant and highly profitable part of Ingevity's business.
Performance Chemicals
This segment creates specialty chemicals primarily from pine trees, a renewable resource. A major part of this business involves making additives for asphalt that allow it to be paved at lower temperatures, saving energy and reducing emissions, and making roads more durable. It also produces ingredients used in a wide variety of industrial products like lubricants, adhesives, and chemicals for agriculture. The company has been actively refining this segment to focus on its more profitable and higher-growth product lines.
Advanced Polymer Technologies
This is Ingevity's business for creating special types of plastics and polymers (long chains of molecules that make up materials). A key product here is called caprolactone, which can be used to make biodegradable plastics, strong adhesives, and durable coatings for things like industrial equipment or medical devices. This segment represents a newer and more technology-focused area for the company. However, Ingevity has recently announced it is exploring strategic options for this business, which could include selling it, as it may not align with the company's future direction.
What management is betting on now
Management is currently focused on making the company more efficient and profitable by concentrating on its strongest businesses. A key priority is to improve the performance of the Performance Chemicals segment by exiting less profitable markets and optimizing its costs. They are also looking to grow the successful Performance Materials segment, which has very strong margins (a measure of profitability). The company is also undergoing a strategic review of its portfolio, which has led to the decision to explore the sale of the Advanced Polymer Technologies segment and its road markings business to sharpen its focus.
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 Q3
$10.40M
FY2024 Q4
$57.70M
FY2025 Q1
$15.40M
FY2025 Q2
$66.80M
FY2025 Q3
$105.60M
FY2025 Q4
$85.70M
FY2026 Q1
$-12.30M
FY2026 Q2
$-24.10M
Revenue
$314.10M
Net income
$35.30M
Diluted EPS
1.00
Operating cash flow
$-13.80M
Free cash flow
$-24.10M
Fetching…
Sources
Revenue
$258.00M
Net income
$59.80M
Diluted EPS
1.66
Operating cash flow
$-2.00M
Free cash flow
$-12.30M
Fetching…
Sources
Revenue
$185.40M
Net income
$-84.60M
Diluted EPS
-2.33
Operating cash flow
$97.10M
Free cash flow
$85.70M
Fetching…
Sources
Revenue
$333.10M
Net income
$43.50M
Diluted EPS
1.18
Operating cash flow
$129.70M
Free cash flow
$105.60M
Fetching…
Sources
Revenue
$365.10M
Net income
$-146.50M
Diluted EPS
-4.02
Operating cash flow
$79.00M
Free cash flow
$66.80M
Fetching…
Sources
Revenue
$284.00M
Net income
$20.50M
Diluted EPS
0.56
Operating cash flow
$25.40M
Free cash flow
$15.40M
Fetching…
Sources
Revenue
$298.80M
Net income
$16.60M
Diluted EPS
0.45
Operating cash flow
$64.50M
Free cash flow
$57.70M
Fetching…
Sources
Revenue
$376.90M
Net income
$-107.20M
Diluted EPS
-2.95
Operating cash flow
$46.50M
Free cash flow
$10.40M
Fetching…
Sources
Is it cheap or expensive?
Fair value $98.34 vs current price $67.13
Wall Street consensus is the average analyst price target: $89.00 (-9.5% lower than our fair-value estimate).
Our most-likely fair value is $98.34 a share — about 46.5% above today's price of $67.13, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Distressed
Net debt $1.1B. Interest coverage 3.4x.
Net debt
$1.14B
Interest coverage
3.40x
Ingevity Corporation's profit covers its interest bill about 3.4 times over. which is stronger than most peers shown here.
Distressed
Worse cushion
Baseline
Better cushion
NGVT
BASELINE
Ingevity Corporation
Total debt $1.24B Interest coverage 3.40x This is the baseline the peer rows are being compared against.
Total debt $47.90M Interest coverage 142.09x +4,083% vs NGVT Carries about 41.8x more debt cushion than NGVT.
Total debt $923.81M Interest coverage 4.02x +18% vs NGVT Carries about 1.2x more debt cushion than NGVT.
Total debt $2.21B Interest coverage 2.83x -17% vs NGVT Carries about 1.2x less debt cushion than NGVT.
Total debt $964.90M Interest coverage 5.27x +55% vs NGVT Carries about 1.6x more debt cushion than NGVT.
Total debt $707.35M Interest coverage 2.65x -22% vs NGVT Carries about 1.3x less debt cushion than NGVT.
What you should know
The case for and against NGVT
2 Rewards
2 Risks
Rewards
-
Returns 30.1% on equity, ahead of 83% of its peers.
-
Free cash flow was positive in 10/10 years.
Risks
-
Stock trades 638.2% above its 5-year average P/E.
-
Insider ownership is only 0.8% (peer median: 1.3%).
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)
94.55x
Forward P/E
11.16x
P/B
49.36x
P/S
1.99x
EV/EBITDA
9.25x
PEG ratio
2.41x
Profitability
How much profit each dollar creates
Gross margin
41.1%
Operating margin
29.9%
Net margin
4.7%
ROE
30.1%
ROA
10.4%
Health
Liquidity and balance-sheet strength
Debt / equity
26.36x
Current ratio
1.61x
Quick ratio
0.78x
Total debt
$1.24B
Total cash
$97.40M
Growth
How the business has been compounding
Revenue TTM
$1.09B
Revenue 5Y CAGR
-4.3%
EPS TTM
0.71
EPS 5Y CAGR
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Cash flow
How much cash the business throws off
Operating CF TTM
$211.00M
Free CF TTM
$273.50M
FCF margin
25.1%
Dividend
Shareholder payout
Yield
—
Payout ratio
0.0%
Last ex-div date
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