Kronos Worldwide, Inc. produces and markets titanium dioxide pigments (TiO2) worldwide. It produces TiO2 in two crystalline forms, rutile and anatase to impart whiteness, brightness, opacity, and durability for products, paints, coatings, plastics, paper, fibers, and ceramics, as well as for various specialty products, such as inks, food, and cosmetics. The company is based in Dallas.
KRO Price Forecast Based on DCF Valuation
DCF Fair Value Target:
We started the process of determining a valid price forecast for Kronos Worldwide Inc with a discounted cash flow analysis -- the results of which can be found in the table below. To summarize, we found that Kronos Worldwide Inc ranked in the 38th percentile in terms of potential gain offered. Our DCF analysis suggests the stock is overvalued by about 33.67%. The most interesting components of our discounted cash flow analysis for Kronos Worldwide Inc ended up being:
Interest coverage, a measure of earnings relative to interest payments, is 7.13; that's higher than 68.64% of US stocks in the Basic Materials sector that have positive free cash flow.
The company's compound free cash flow growth rate over the past 5.75 years comes in at -0.03%; that's greater than only 25% of US stocks we're applying DCF forecasting to.
Kronos Worldwide Inc's weighted average cost of capital (WACC) is 7%; for context, that number is higher than only 16.78% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Basic Materials that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as KRO, try SHW, RPM, UFS, OEC, and LYB.