📊 ESI Key Takeaways
Is Element Solutions Inc (ESI) a Good Investment?
Element Solutions exhibits strong revenue growth and solid profitability margins, but concerning operational metrics reveal deteriorating cash generation despite positive net income. The company's massive revenue spike (4877.5% YoY) requires scrutiny for sustainability, while negative free cash flow and declining EPS suggest operational challenges beneath the surface.
Element Solutions shows solid underlying profitability with a 42.0% gross margin, 13.4% operating margin, and a strong liquidity position. However, growth quality looks weak because the reported revenue surge is not translating into better net income, EPS declined materially, and cash generation deteriorated to negative free cash flow. The fundamentals support balance-sheet stability, but weak cash conversion and thin interest coverage limit conviction.
Why Buy Element Solutions Inc Stock? ESI Key Strengths
- Exceptional revenue growth of 4877.5% YoY indicates significant business expansion or strategic acquisition
- Healthy gross margin of 42% and operating margin of 13.4% demonstrate pricing power and operational efficiency
- Strong liquidity position with 3.68x current ratio and 3.00x quick ratio provides financial flexibility
- Moderate leverage with 0.61x debt-to-equity ratio indicates manageable debt load
- Healthy gross and operating margins indicate resilient core economics
- Strong liquidity with $626.5M of cash and a 3.68x current ratio supports financial flexibility
- Moderate leverage with 0.61x debt-to-equity keeps the balance sheet manageable
ESI Stock Risks: Element Solutions Inc Investment Risks
- Negative free cash flow of -$36.2M despite $190.8M net income signals potential working capital issues or unsustainable profitability
- Declining diluted EPS of -21.8% YoY contrasts sharply with rising net income, indicating significant shareholder dilution
- Weak interest coverage of 2.3x leaves limited cushion for debt service under economic stress
- Massive 4877.5% revenue growth is anomalous and difficult to validate as sustainable organic growth
- Low ROE of 7.1% and ROA of 3.7% suggest inefficient capital deployment despite growth narrative
- Operating cash flow of only $26.0M and negative free cash flow suggest weak earnings-to-cash conversion
- Interest coverage of 2.3x leaves limited cushion if financing costs stay elevated or profits soften
- Reported revenue growth appears low quality because net income was flat and diluted EPS fell 21.8%
Key Metrics to Watch
- Free cash flow trend and working capital management over next 2-3 quarters
- Sustainability and composition of 4877% revenue growth (organic vs. acquisition-driven)
- EPS trajectory and shareholder dilution dynamics
- Operating cash flow stability and cash conversion ratio
- Debt paydown progress and interest coverage improvement
- Operating cash flow and free cash flow recovery
- Interest coverage and net income per diluted share
Element Solutions Inc (ESI) Financial Metrics & Key Ratios
💡 AI Analyst Insight
Strong liquidity with a 3.68x current ratio provides a solid financial cushion.
ESI Profit Margin, ROE & Profitability Analysis
ESI vs Materials Sector: How Element Solutions Inc Compares
How Element Solutions Inc compares to Materials sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Element Solutions Inc Stock Overvalued? ESI Valuation Analysis 2026
Based on fundamental analysis, Element Solutions Inc has mixed fundamental signals relative to the Materials sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Element Solutions Inc Balance Sheet: ESI Debt, Cash & Liquidity
ESI Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Element Solutions Inc's revenue has shown modest growth of 6% over the 5-year period. The most recent EPS of $0.49 reflects profitable operations.
ESI Revenue Growth, EPS Growth & YoY Performance
ESI Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2025 | $645.0M | $39.3M | $0.16 |
| Q2 2025 | $612.7M | $47.4M | $0.20 |
| Q1 2025 | $575.0M | N/A | $0.23 |
| Q3 2024 | $599.3M | -$31.8M | $-0.13 |
| Q2 2024 | $586.1M | $29.9M | $0.12 |
| Q1 2024 | $574.4M | $42.9M | $0.18 |
| Q3 2023 | $599.3M | -$31.8M | $-0.13 |
| Q2 2023 | $586.1M | $29.9M | $0.12 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Element Solutions Inc Dividends, Buybacks & Capital Allocation
ESI SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Element Solutions Inc (CIK: 0001590714)
📋 Recent SEC Filings
❓ Frequently Asked Questions about ESI
What is the AI rating for ESI?
Element Solutions Inc (ESI) has a Combined AI Rating of HOLD from Claude (HOLD) and ChatGPT (HOLD) with 70% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are ESI's key strengths?
Claude: Exceptional revenue growth of 4877.5% YoY indicates significant business expansion or strategic acquisition. Healthy gross margin of 42% and operating margin of 13.4% demonstrate pricing power and operational efficiency. ChatGPT: Healthy gross and operating margins indicate resilient core economics. Strong liquidity with $626.5M of cash and a 3.68x current ratio supports financial flexibility.
What are the risks of investing in ESI?
Claude: Negative free cash flow of -$36.2M despite $190.8M net income signals potential working capital issues or unsustainable profitability. Declining diluted EPS of -21.8% YoY contrasts sharply with rising net income, indicating significant shareholder dilution. ChatGPT: Operating cash flow of only $26.0M and negative free cash flow suggest weak earnings-to-cash conversion. Interest coverage of 2.3x leaves limited cushion if financing costs stay elevated or profits soften.
What is ESI's revenue and growth?
Element Solutions Inc reported revenue of $2.6B.
Does ESI pay dividends?
Element Solutions Inc pays dividends, with $77.8M distributed to shareholders in the trailing twelve months.
Where can I find ESI SEC filings?
Official SEC filings for Element Solutions Inc (CIK: 0001590714) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is ESI's EPS?
Element Solutions Inc has a diluted EPS of $0.79.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is ESI a good stock to buy right now?
Based on our AI fundamental analysis in April 2026, Element Solutions Inc has a HOLD rating with 70% confidence. Review the strengths and risks sections above before making a decision. This is not investment advice.
Is ESI stock overvalued or undervalued?
Valuation metrics for ESI: ROE of 7.1% (sector avg: 14%), net margin of 7.5% (sector avg: 10%). Compare these metrics with sector averages to assess valuation.
Should I buy ESI stock in 2026?
Our dual AI analysis gives Element Solutions Inc a combined HOLD rating for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is ESI's free cash flow?
Element Solutions Inc's operating cash flow is $26.0M, with capital expenditures of $62.2M. FCF margin is -1.4%.
How does ESI compare to other Materials stocks?
Vs Materials sector averages: Net margin 7.5% (avg: 10%), ROE 7.1% (avg: 14%), current ratio 3.68 (avg: 1.6).