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NewMarket Corp (NEU) Company Bio

NewMarket Corporation develops, manufactures, blends, and delivers chemical additives that enhance the performance of petroleum products. The company was founded in 1887 and is based in Richmond, Virginia.

NEU Price Forecast Based on DCF Valuation

Below please find a table outlining a discounted cash flow forecast for NEU, in which we model out valuation assuming a variety of terminal growth rates. To summarize, we found that Newmarket Corp ranked in the 42st percentile in terms of potential gain offered. We should note, though, that the most conservative analysis suggests this stock will yield negative results -- and thus may be a potential short opportunity. The most interesting components of our discounted cash flow analysis for Newmarket Corp ended up being:

• Newmarket Corp's effective tax rate, as measured by taxes paid relative to net income, is at 18 -- greater than 71.08% of US stocks with positive free cash flow.
• Newmarket Corp's interest coverage rate -- a measure of gross earnings relative to interest payments -- comes in at 12.34. This coverage rate is greater than that of 77.05% of stocks we're observing for the purpose of forecasting via discounted cash flows.
• Relative to other stocks in its sector (Basic Materials), Newmarket Corp has a reliance on debt greater than only 21.76% of them.

For other companies in the Basic Materials that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as NEU, try LYB, SHW, SID, MAS, and NP.