Kronos Worldwide Inc (KRO) stock analysis

P/E against its history

Not enough price and earnings history to compare.

P/E against the industry

Needs positive earnings and enough profitable companies in the industry.

EV/EBITDA above its 5-year median

Kronos Worldwide's EV/EBITDA of 33.0 is above its 5-year median of 11.3.

P/B above the industry

Kronos Worldwide's price-to-book of 1.25 is above the Chemicals and Allied Products median of 1.25.

Trading above fair value

The share price of $8.50 is above our fair value estimate of $3.61.

Margin of safety under 20%

The price is 135% above fair value, so there is no margin of safety.

Revenue growing under 10% a year

Revenue grew -1.2% a year over the last three fiscal years, short of the 10% we look for.

EPS growth over 3 years

Needs positive EPS three years ago and today.

Earnings acceleration

Needs positive net income now, a year ago and five years ago.

Growing faster than the industry

Revenue grew 8.7% over the last twelve months; the Chemicals and Allied Products median is 8.2%.

Company guidance

No outlook found in earnings releases from the last twelve months.

Gross margin slipping

Gross margin was 15.3% over the last twelve months, against 16.3% a year earlier.

Return on equity under 15%

Return on equity was -4.7% over the last twelve months and averaged 3.2% over five years; we look for 15% on both.

Return on capital under 10%

Return on invested capital was 2.6%, below the 10% that usually covers the cost of capital.

Return on equity below the industry

Kronos Worldwide's return on equity of -4.7% is below the Chemicals and Allied Products median of -0.8%.

Earnings over 5 years

Needs positive net income five years ago and in the latest year.

Net margin below its 5-year average

Net margin was -1.9% over the last twelve months, against a 5-year average of 1.4%.

Net margin below the industry

Kronos Worldwide's net margin of -1.9% is below the Chemicals and Allied Products median of -0.4%.

High debt

Debt is 68.9% of shareholders' equity, above the 40% we consider low.

Debt rising against equity

Debt to equity rose from 61.2% five years ago to 68.9%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 27.2% of total debt.

Interest not well covered

Operating income covers interest expense 0.8 times; we look for at least 5.

Short-term assets cover short-term debts

Current assets are 3.30 times current liabilities.

Bankruptcy risk in the grey zone

The Altman Z-score is 2.06; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Kronos Worldwide paid dividends worth 2.4% of the share price over the last twelve months.

Yield below Treasuries

The 2.4% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; Kronos Worldwide yields 2.4%.

Dividend was cut

The dividend per share fell by more than 10% at least once in the last 10 fiscal years.

Earnings cover

Needs dividends paid and net income.

Cash-flow cover

Needs dividends paid and free cash flow.