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Element Solutions (NYSE:ESI) Financial Strength

: 5 (As of Sep. 2022)
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Element Solutions has the Financial Strength Rank of 5.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.

Element Solutions's Interest Coverage for the quarter that ended in Sep. 2022 was 6.44. Element Solutions's debt to revenue ratio for the quarter that ended in Sep. 2022 was 0.77. As of today, Element Solutions's Altman Z-Score is 1.72.


Element Solutions (NYSE:ESI) Financial Strength Competitive Comparison

For the Specialty Chemicals subindustry, Element Solutions's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

Element Solutions (NYSE:ESI) Financial Strength Distribution

For the Chemicals industry and Basic Materials sector, Element Solutions's Financial Strength distribution charts can be found below:

* The bar in red indicates where Element Solutions's Financial Strength falls into.



Element Solutions Financial Strength Calculation

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

Element Solutions's Interest Expense for the months ended in Sep. 2022 was $-12 Mil. Its Operating Income for the months ended in Sep. 2022 was $79 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Sep. 2022 was $1,887 Mil.

Element Solutions's Interest Coverage for the quarter that ended in Sep. 2022 is

Interest Coverage=-1*Operating Income (Q: Sep. 2022 )/Interest Expense (Q: Sep. 2022 )
=-1*79.2/-12.3
=6.44

The higher the ratio, the stronger the company's financial strength is.

2. Debt to revenue ratio. The lower, the better.

Element Solutions's Debt to Revenue Ratio for the quarter that ended in Sep. 2022 is

Debt to Revenue Ratio=Total Debt (Q: Sep. 2022 ) / Revenue
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / Revenue
=(11.9 + 1886.8) / 2474
=0.77

3. Altman Z-Score.

Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The zones of discrimination were as such:

When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.

Element Solutions has a Z-score of 1.72, indicating it is in Distress Zones. This implies bankrupcy possibility in the next two years.

Warning Sign:

Altman Z-score of 1.72 is in distress zone. This implies bankruptcy possibility in the next two years.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Element Solutions  (NYSE:ESI) Financial Strength Explanation

The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.

Element Solutions has the Financial Strength Rank of 5.


Element Solutions Financial Strength Related Terms

Thank you for viewing the detailed overview of Element Solutions's Financial Strength provided by GuruFocus.com. Please click on the following links to see related term pages.


Element Solutions (NYSE:ESI) Business Description

Element Solutions logo
Traded in Other Exchanges
Address
500 East Broward Boulevard, Suite 1860, Fort Lauderdale, FL, USA, 33394
Element Solutions Inc specialty chemicals company whose businesses supply a broad range of solutions that enhance the performance of products people use every day. Developed in multi-step technological processes, these innovative solutions enable customers' manufacturing processes in several key industries, including consumer electronics, power electronics, semiconductor fabrication, communications and data storage infrastructure, automotive systems, industrial surface finishing, consumer packaging, and offshore energy.
Executives
Filon Elyse Napoli director 383 MAIN AVENUE, 6TH FLOOR NORWALK CT 06851
Goralski Michael officer: See Remarks 383 MAIN AVENUE, 6TH FLOOR NORWALK CT 06851
D'ambrisi Joseph J. officer: SVP and Head of Electronics 383 MAIN AVENUE, 6TH FLOOR NORWALK CT 06851
Mount Patricia officer: VP, Program Mgt & Integration JARDEN CORPORATION 555 THEODORE FREMD AVENUE RYE NY 10580
Fraser Christopher T. director 9555 WEST SAM HOUSTON PARKWAY SOUTH SUITE 600 HOUSTON TX 77099
Dorman Carey J. officer: Chief Financial Officer C/O ELEMENT SOLUTIONS INC 383 MAIN AVENUE, 6TH FLOOR NORWALK CT 06851
Maynard-elliott Nichelle director PLATFORM SPECIALTY PRODUCTS CORPORATION 383 MAIN AVENUE NORWALK CT 06851
Tolbert John David officer: Chief Human Resources Officer 345 S HIGH STREET STE 201 MUNCIE IN 47305
Connolly John P. officer: VP, Corp. Controller and CAO XYLEM INC. 1133 WESTCHESTER AVENUE, SUITE N200 WHITE PLAINS NY 10604
Gibbens Mark other: VP - Corporate Treasurer 245 FREIGHT STREET WATERBURY CT 06702
Capps John Edward officer: EVP, General Counsel & Sec. 2381 EXECUTIVE CENTER DRIVE BOCA RATON FL 33431
Casanello Diego Lopez officer: President - Ag Solutions 245 FREIGHT STREET WATERBURY CT 06702
Benson Scot officer: President - Perf. Solutions 245 FREIGHT STREET WATERBURY CT 06702
Sachdev Rakesh officer: Chief Executive Officer 3050 SPRUCE STREET ST LOUIS MO 63103
Khattri Sanjiv officer: CFO COVANTA HOLDING CORPORATION 40 LANE ROAD FAIRFIELD NJ 07004

Element Solutions (NYSE:ESI) Headlines

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