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1. Company Snapshot

1.a. Company Description

Ingevity Corporation manufactures and sells specialty chemicals and activated carbon materials in North America, the Asia Pacific, Europe, the Middle East, Africa, and South America.The company operates through two segments, Performance Materials and Performance Chemicals.The Performance Materials segment engineers, manufactures, and sells hardwood-based and chemically activated carbon products primarily for use in gasoline vapor emission control systems in cars, motorcycles, trucks, and boats.


This segment also produces other activated carbon products for use in various applications, including food, water, beverage, and chemical purification.The Performance Chemicals segment comprises of pavement technologies, industrial specialties, and engineered polymers.It manufactures products derived from crude tall oil and lignin extracted from the kraft pulping process, as well as caprolactone monomers and derivatives derived from cyclohexanone and hydrogen peroxide.


This segment's products are used in various applications comprising warm mix paving, pavement preservation, pavement reconstruction and recycling, oil well service additives, oil production, and downstream applications; and adhesives, agrochemical dispersants, lubricants, printing inks, industrial intermediates and oilfield, coatings, resins, elastomers, bioplastics, and medical devices.Ingevity Corporation was founded in 1964 and is headquartered in North Charleston, South Carolina.

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1.b. Last Insights on NGVT

Negative drivers behind Ingevity Corporation's recent 3 months performance include declining revenues in the fourth quarter due to the repositioning of the Performance Chemicals segment. This segment's decline was a major contributor to the company's year-over-year revenue decrease. Additionally, the company's efforts to drive growth through strategic acquisitions and actions have been overshadowed by soft end-market demand, which has dampened the prospects of the Chemicals Specialty industry. Furthermore, Ingevity's recent proxy statement filing and leadership changes, including the appointment of a new CEO, may have created uncertainty and negatively impacted investor sentiment.

1.c. Company Highlights

2. Ingevity's Q3 2025 Earnings: Strong Execution and Strategic Progress

Ingevity reported total sales of $362 million in Q3, down 4% year-over-year, with adjusted EBITDA margin expanding to 33.5%, driven by lower raw material costs and successful repositioning actions. The company's adjusted EBITDA was $56.3 million, up almost 500 basis points, and EPS came in at $1.31, beating estimates of $0.74. Free cash flow was $118 million, enabling $25 million in share repurchases and accelerating deleveraging to a net leverage of 2.7x.

Publication Date: Nov -30

📋 Highlights
  • Divestiture Announcement:: Sale of Industrial Specialties business for $110M, expected to close in early 2026, adding $40M to free cash flow.
  • Q3 Financial Performance:: Total sales of $362M (-4% YoY), adjusted EBITDA of $56.3M (+500 bps), and EBITDA margin of 33.5%.
  • Free Cash Flow & Leverage:: Generated $118M in free cash flow, enabling $25M share repurchases and net leverage reduction to 2.7x.
  • Segment Dynamics:: Performance Materials sales up 3%, Road Technologies record North American sales, and APT margins remained strong despite weak demand.
  • Guidance Adjustments:: Narrowed full-year sales and EBITDA ranges due to tariff uncertainties and slower APT demand, with $130M in sales from the divestiture.

Segment Performance

The Performance Materials segment saw a 3% increase in sales due to volume growth, while Road Technologies posted record sales in North America. APT delivered strong margins despite weak end market demand, and Performance Chemicals combined sales were down almost 5%, with Road Technologies sales up 5%. The company's strategic actions and repositioning efforts are yielding positive results, as evident in the segment performances.

Cash Flow and Leverage

Ingevity generated $118 million in free cash flow, which was used for share repurchases and deleveraging. The company's net leverage ratio improved to 2.7x, beating the previous year-end target of 2.8x. With a Free Cash Flow Yield of 7.91%, the company's ability to generate cash is a positive aspect of its financial health.

Valuation and Outlook

With a P/E Ratio of -8.78 and an EV/EBITDA of -57.96, the market's expectations for Ingevity's future performance are already factored into the current valuation. Analysts estimate next year's revenue growth at 1.7%. The company's strategic portfolio review and expectations for the future will be discussed in the Investor Update on December 8. As the company continues to execute on its strategic plans, including the divestiture of Industrial Specialties, investors will be watching for progress on the Nexeon platform and other initiatives. The current valuation metrics indicate that the market has certain expectations from the company, and the upcoming Investor Update will provide more insights into Ingevity's future prospects.

3. NewsRoom

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Touchstone Small Cap Fund Q3 2025 Contributors And Detractors

Nov -26

Source: seekingalpha.com

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CHASM and Ingevity Expand Partnership Through License Agreement to Secure Local CNT Supply Chain for North American and European EV Battery Gigafactories

Nov -11

Source: prnewswire.com

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The London Company Small Cap Q3 2025 Performance Update

Nov -07

Source: seekingalpha.com

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Ingevity Corporation (NGVT) Q3 2025 Earnings Call Transcript

Nov -06

Source: seekingalpha.com

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Ingevity announces virtual strategic portfolio update for investors on December 8

Nov -06

Source: businesswire.com

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Ingevity reports third quarter 2025 financial results

Nov -05

Source: businesswire.com

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Ingevity Corporation $NGVT Shares Bought by Teacher Retirement System of Texas

Nov -05

Source: defenseworld.net

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Ingevity announces dates for third quarter 2025 earnings release and webcast

Oct -23

Source: businesswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.27%)

6. Segments

Performance Chemicals

Expected Growth: 4.85%

Ingevity's Performance Chemicals segment growth of 4.85% is driven by increasing demand for specialty chemicals in oilfield applications, growth in industrial specialties, and expansion in emerging markets. Additionally, the company's focus on innovation and product development, as well as its strategic acquisitions, have contributed to the segment's growth.

Performance Materials

Expected Growth: 4.83%

Ingevity's Performance Materials segment growth of 4.83% is driven by increasing demand for automotive carbon filters, growth in industrial specialties, and expansion in Asia-Pacific region. Additionally, the company's strategic investments in new product development and capacity expansion have contributed to the segment's growth.

Advanced Polymer Technologies

Expected Growth: 8.37%

Advanced Polymer Technologies from Ingevity Corporation's 8.37% growth is driven by increasing demand for sustainable and eco-friendly products, growth in the automotive and industrial coatings markets, and the company's strategic investments in R&D and capacity expansion.

7. Detailed Products

Activated Carbon

Ingevity's activated carbon products are used to remove impurities and contaminants from liquids and gases, improving taste, odor and purity.

Specialty Chemicals

Ingevity's specialty chemicals are used in a variety of applications, including asphalt emulsions, construction materials, and oilfield applications.

Pavement Technologies

Ingevity's pavement technologies are used to improve the durability and performance of asphalt pavements, reducing maintenance costs and extending lifespan.

Engineered Polymers

Ingevity's engineered polymers are used in a variety of applications, including adhesives, coatings, and composites.

Bio-based Technologies

Ingevity's bio-based technologies are used to develop sustainable and renewable products, reducing dependence on fossil fuels.

8. Ingevity Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

Ingevity Corporation's products are specialized and have few substitutes, but customers may still opt for alternative products or services.

Bargaining Power Of Customers

Ingevity Corporation's customers have limited bargaining power due to the company's strong market position and diversified customer base.

Bargaining Power Of Suppliers

Ingevity Corporation's suppliers have moderate bargaining power due to the company's dependence on a few key suppliers for raw materials.

Threat Of New Entrants

The threat of new entrants is low due to the high barriers to entry in the specialty chemicals and materials industry, including significant capital requirements and regulatory hurdles.

Intensity Of Rivalry

The specialty chemicals and materials industry is highly competitive, with several established players competing for market share, leading to a high intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 68.70%
Debt Cost 11.37%
Equity Weight 31.30%
Equity Cost 12.90%
WACC 11.85%
Leverage 219.50%

11. Quality Control: Ingevity Corporation passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Perimeter Solutions

A-Score: 4.8/10

Value: 3.8

Growth: 6.8

Quality: 6.0

Yield: 0.0

Momentum: 8.5

Volatility: 3.7

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Stepan

A-Score: 4.3/10

Value: 6.2

Growth: 3.3

Quality: 3.9

Yield: 4.0

Momentum: 1.0

Volatility: 7.3

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Ingevity

A-Score: 4.1/10

Value: 6.3

Growth: 2.0

Quality: 3.5

Yield: 0.0

Momentum: 9.0

Volatility: 4.0

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Gevo

A-Score: 3.8/10

Value: 7.6

Growth: 4.8

Quality: 4.7

Yield: 0.0

Momentum: 5.0

Volatility: 1.0

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Alto Ingredients

A-Score: 2.9/10

Value: 9.8

Growth: 1.8

Quality: 3.9

Yield: 0.0

Momentum: 0.5

Volatility: 1.7

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Trinseo

A-Score: 2.8/10

Value: 8.5

Growth: 0.8

Quality: 1.1

Yield: 5.0

Momentum: 0.5

Volatility: 1.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

52.91$

Current Price

52.91$

Potential

-0.00%

Expected Cash-Flows