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Ingevity Corporation’s NGVT shares have gained 9.6% over the past six months. The company has also outperformed the Zacks Chemicals Specialty industry’s decline of 8% over the same time frame.
Let’s take a look into the factors that are driving NGVT stock.
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NGVT Gains on Strategic Repositioning and Acquisitions
Ingevity is taking several actions to expand capacity and drive long-term growth. It remains committed to investing organically. Ingevity is also committed to capturing the maximum value for its products.
The company is expected to benefit from the repositioning of its Performance Chemicals segment, which is aimed at lowering exposure to lower-margin end markets. The move includes consolidating segment operations at its North Charleston facility by moving oleo chemical refining to the North Charleston site’s secondary refinery as well as the closure of its Crossett facility. These actions further simplify the segment’s manufacturing footprint and create significant cost savings. NGVT realized roughly $84 million of savings from repositioning actions in 2024. It sees around $10-$25 million in incremental savings in 2025.
Ingevity remains focused on enhancing shareholder value through improved EBITDA, improving margins and strong cash flows. The company is seeing the benefits of the repositioning on its earnings and cash flows. Operational improvements leading to lower input costs and better manufacturing efficiency are also aiding performance in its Performance Materials unit.
The acquisition of the Capa caprolactone business enabled the company with a new technology platform to drive revenue and earnings growth. Capa has a strong and market-leading business that focuses on high-growth end-use applications. NGVT, in July 2024, expanded its Capa caprolactone distribution network by selecting Ultrapolymers Group as the distributor for Capa Bioplastics in Europe. The acquisition of Ozark Materials has also strengthened the company’s position in the paving construction industry.
Ingevity Corporation Price and Consensus
Ingevity Corporation price-consensus-chart | Ingevity Corporation Quote
NGVT’s Zacks Rank & Other Key Picks
NGVT currently carries a Zacks Rank #1 (Strong Buy).
Other top-ranked stocks in the Basic Materials space are Axalta Coating Systems Ltd. AXTA, CSW Industrials Inc. CSWI and Carpenter Technology Corporation CRS. While AXTA sports a Zacks Rank #1, CSWI and CRS carry a Zacks Rank #2 (Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Axalta Coating’s 2025 earnings is pegged at $2.51, indicating a rise of 6.8% from year-ago levels. AXTA beat the consensus estimate in each of the trailing four quarters. In this time frame, it has delivered an earnings surprise of roughly 16.3%, on average.
The Zacks Consensus Estimate for CSW Industrials’ current fiscal-year earnings is pegged at $8.50, suggesting a 21.3% year-over-year increase. CSWI surpassed the Zacks Consensus Estimate in each of the trailing four quarters, with an average earnings surprise of 10.1%.