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Basf SE ADR BASFY

Morningstar Rating
$12.73 −0.16 (1.24%)
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Company Report

BASF Earnings: End of Destocking Should Lead to Profit Growth in 2024

BASF's fourth-quarter results show the continued challenge of weak chemicals demand due to customer inventory destocking, as adjusted operating profits fell nearly 22% versus the prior-year quarter. However, during the quarter, volumes were down less than 1% year over year and segment operating profits grew in all businesses except chemicals and agricultural solutions. This shows that demand is returning, which is in line with our thesis that BASF's profits will improve in 2024. After our initial earnings review, we're maintaining our EUR 62 ($16) fair value estimate. Our narrow moat rating is also unchanged.

Price vs Fair Value

BASFY is trading at a 20% discount.
Price
$12.73
Fair Value
$71.00
Uncertainty
Medium
1-Star Price
$35.50
5-Star Price
$83.60
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

BASF’s Verbund concept drives strong returns through operational optimization that minimizes production costs even despite the firm’s reliance on costlier feedstocks than peers.

Bears

The Verbund concept can be replicated, potentially eroding the firm’s cost advantage if enough competitors implement similar processes.

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News

Trading Information

Previous Close Price
$12.89
Day Range
$12.6912.79
52-Week Range
$10.6613.90
Bid/Ask
$12.70 / $12.95
Market Cap
$45.45 Bil
Volume/Avg
182,041 / 163,530

Key Statistics

Price/Earnings (Normalized)
14.31
Price/Sales
0.59
Dividend Yield (Trailing)
7.35%
Dividend Yield (Forward)
7.35%
Total Yield
7.56%

Company Profile

Founded in 1865 and based in Germany, BASF is the world’s largest chemical company, with products spanning the full spectrum of commodities to specialties. In addition, the company is a strong player in agricultural crop protection chemicals and emissions control catalysts for cars and trucks. Given its sheer size, BASF has a top-three market position in approximately 70% of its businesses.
Sector
Basic Materials
Industry
Chemicals
Stock Style Box
Large Value
Total Number of Employees
111,991

Competitors

Valuation

Metric
BASFY
1COV
Price/Earnings (Normalized)
14.31
Price/Book Value
1.101.34
Price/Sales
0.590.64
Price/Cash Flow
99.7423.80
Price/Earnings
BASFY
1COV

Financial Strength

Metric
BASFY
1COV
Quick Ratio
1.121.08
Current Ratio
1.991.81
Interest Coverage
−1.45−2.03
Quick Ratio
BASFY
1COV

Profitability

Metric
BASFY
1COV
Return on Assets (Normalized)
−2.67%−6.38%
Return on Equity (Normalized)
−5.66%−12.88%
Return on Invested Capital (Normalized)
−2.96%−7.55%
Return on Assets
BASFY
1COV
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Economic Moat
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BFFAF
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DOW
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CE
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PECGF
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