Sensient Technologies Corp (SXT) stock analysis

P/E above its 5-year median

Sensient Technologies's P/E of 29.9 is above its own 5-year median of 29.7.

P/E above the industry

Sensient Technologies's P/E of 29.9 is above the Chemicals and Allied Products median of 25.2.

EV/EBITDA above its 5-year median

Sensient Technologies's EV/EBITDA of 18.3 is above its 5-year median of 17.5.

P/B above the industry

Sensient Technologies's price-to-book of 3.93 is above the Chemicals and Allied Products median of 1.51.

Trading above fair value

The share price of $118.81 is above our fair value estimate of $95.56.

Margin of safety under 20%

The price is 24.3% above fair value, so there is no margin of safety.

Revenue growing under 10% a year

Revenue grew 3.9% a year over the last three fiscal years, short of the 10% we look for.

EPS growing under 10% a year

Diluted EPS grew -1.8% a year over the last three fiscal years.

Earnings growth accelerating

Net income grew 21.7% over the last twelve months, against a 5-year average of 4.2% a year.

Growing faster than the industry

Revenue grew 9.5% over the last twelve months; the Chemicals and Allied Products median is 3.5%.

Guidance raised

Sensient Technologies raised its 2026 Diluted EPS (GAAP) outlook on Apr 24, 2026.

Gross margin improving

Gross margin was 35.1% over the last twelve months, against 33.6% a year earlier.

Return on equity under 15%

Return on equity was 13.7% over the last twelve months and averaged 12.0% over five years; we look for 15% on both.

Return on capital under 10%

Return on invested capital was 10.0%, below the 10% that usually covers the cost of capital.

Return on equity above the industry

Sensient Technologies's return on equity of 13.7% is above the Chemicals and Allied Products median of -16.2%.

Earnings grew over 5 years

Net income grew 4.2% a year on average over the last five fiscal years.

Net margin above its 5-year average

Net margin was 9.7% over the last twelve months, against a 5-year average of 8.2%.

Net margin above the industry

Sensient Technologies's net margin of 9.7% is above the Chemicals and Allied Products median of -13.3%.

High debt

Debt is 61.4% of shareholders' equity, above the 40% we consider low.

Debt rising against equity

Debt to equity rose from 57.4% five years ago to 61.4%.

Debt not well covered by cash flow

Operating cash flow over the last twelve months equals 15.2% of total debt; we look for at least 20%.

Interest well covered

Operating income covers interest expense 8.0 times.

Short-term assets cover short-term debts

Current assets are 3.97 times current liabilities.

Low bankruptcy risk

The Altman Z-score is 5.16; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Sensient Technologies paid dividends worth 1.0% of the share price over the last twelve months.

Yield below Treasuries

The 1.0% 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; Sensient Technologies yields 1.0%.

Dividend not cut

The dividend per share has not fallen by more than 10% in any of the last 10 fiscal years.

Covered by earnings

Dividends take 41.2% of net income.

Cash-flow cover

Needs dividends paid and free cash flow.