Axalta Coating Systems (NYSE:AXTA) Issues Quarterly Earnings Results

Axalta Coating Systems (NYSE:AXTA) posted its earnings results on Thursday. The specialty chemicals company reported $0.63 earnings per share for the quarter, missing the consensus estimate of $0.70 by ($0.07), Zacks reports. The business had revenue of $1.31 billion for the quarter, compared to analysts’ expectations of $1.33 billion. Axalta Coating Systems had a net margin of 6.78% and a return on equity of 22.35%. The business’s revenue was up 1.8% compared to the same quarter last year. During the same quarter last year, the business posted $0.67 earnings per share.

Here are the key takeaways from Axalta Coating Systems’ conference call:

• Full-year outlook was reduced after weaker-than-expected European Refinish volumes and increased macroeconomic uncertainty. Axalta now expects fourth-quarter sales to be roughly flat year over year, fourth-quarter adjusted EBITDA of $254 million–$264 million, and full-year adjusted EBITDA of approximately $1.10 billion–$1.11 billion.
• Mobility Coatings delivered a record quarter, with sales up 7% to $493 million and adjusted EBITDA up 13% to $94 million. Commercial Vehicle sales surged 24%, while Light Vehicle volumes remained roughly flat despite global production declining nearly 2%.
• Third-quarter adjusted EBITDA declined 4% to $282 million, pressured by lower European Refinish volumes, freight costs rising more than 15%, higher raw-material costs, and investments to convert major body-shop wins. Management also expects near-term margin pressure as those conversions accelerate.
• Cash generation and leverage improved significantly: year-to-date free cash flow rose 25% to $220 million, while gross debt fell below $3 billion and net leverage reached a record-low 2.1 times. Excluding merger-related costs, underlying free cash flow was up nearly 50%.
• The proposed AkzoNobel merger remains on track for an early-2027 closing, with regulatory clearance secured in two-thirds of required jurisdictions. Management continues to target approximately $600 million of annual run-rate cost synergies, with about 90% expected within three years after closing.

Axalta Coating Systems Trading Down 3.1%

AXTA traded down $1.06 during trading on Thursday, hitting $33.58. The company’s stock had a trading volume of 2,113,105 shares, compared to its average volume of 2,446,937. Axalta Coating Systems has a twelve month low of $24.94 and a twelve month high of $38.61. The stock has a market cap of $7.19 billion, a PE ratio of 20.73, a PEG ratio of 1.85 and a beta of 1.26. The firm’s 50 day moving average price is $34.08 and its 200-day moving average price is $32.34. The company has a debt-to-equity ratio of 0.99, a current ratio of 1.53 and a quick ratio of 1.12.

Analysts Set New Price Targets

A number of research firms recently issued reports on AXTA. KeyCorp reaffirmed an “overweight” rating on shares of Axalta Coating Systems in a research note on Monday, October 5th. BMO Capital Markets reissued a “market perform” rating on shares of Axalta Coating Systems in a report on Monday, September 21st. The Goldman Sachs Group restated a “buy” rating and issued a $38.00 price objective on shares of Axalta Coating Systems in a research report on Friday, October 9th. UBS Group decreased their price objective on Axalta Coating Systems from $39.00 to $36.00 and set a “neutral” rating on the stock in a research note on Monday, October 5th. Finally, Robert W. Baird lifted their price objective on Axalta Coating Systems from $35.00 to $37.00 and gave the stock a “neutral” rating in a research report on Wednesday, July 29th. One equities research analyst has rated the stock with a Strong Buy rating, four have assigned a Buy rating and eight have assigned a Hold rating to the stock. According to MarketBeat.com, Axalta Coating Systems currently has a consensus rating of “Hold” and an average target price of $38.18.

About Axalta Coating Systems

Axalta Coating Systems Ltd. (NYSE: AXTA) develops, manufactures and sells coatings and coating technologies designed to protect, enhance and improve the appearance of vehicles, equipment and industrial products. Its offerings include liquid, powder and electrocoat products, along with related color-management tools, application technologies and technical services.

The company serves several markets, including automotive original equipment manufacturers, automotive refinish businesses, commercial transportation, industrial equipment, architecture and general manufacturing.