Industrial coatings provider Axalta's Q3 net sales miss estimates, adjusted EPS beats

Overview

• Axalta Q3 net sales fell 2% yr/yr, missing analyst expectations

• Adjusted EPS for Q3 sets record, beats consensus expectations

• Company executed $100 mln in share repurchases during Q3

Outlook

• Axalta projects Q4 net sales growth in mid single-digit percentage

• Axalta expects FY 2025 net sales to exceed $5.1 bln

• Axalta plans up to $250 mln in share repurchases in Q4

Result Drivers

• PERFORMANCE COATINGS CHALLENGES - Net sales in Performance Coatings fell due to macroeconomic pressures in North America, partially offset by positive price-mix and favorable foreign currency translation

• MOBILITY COATINGS GROWTH - Mobility Coatings net sales rose 4% due to positive price-mix and favorable foreign currency translation, despite volume softness

• COST MANAGEMENT - Reduction in selling, general, and administrative expenses and lower interest expense contributed to increased net income

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 12 "strong buy" or "buy", 8 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the commodity chemicals peer group is "buy"

• Wall Street's median 12-month price target for Axalta Coating Systems Ltd is $35.55, about 18.3% above its October 27 closing price of $29.06

• The stock recently traded at 11 times the next 12-month earnings vs. a P/E of 11 three months ago

Press Release: ID:nGNX7B8t4C

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