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1. Company Snapshot

1.a. Company Description

NewMarket Corporation, through its subsidiaries, engages in the petroleum additives business.The company offers lubricant additives for use in various vehicle and industrial applications, including engine oils, transmission fluids, off-road powertrain and hydraulic systems, gear oils, hydraulic oils, turbine oils, and other applications where metal-to-metal moving parts are utilized; engine oil additives designed for passenger cars, motorcycles, on and off-road heavy duty commercial equipment, locomotives, and engines in ocean-going vessels; driveline additives designed for products, such as transmission fluids, axle fluids, and off-road powertrain fluids; and industrial additives designed for products for industrial applications consisting of hydraulic fluids, grease, industrial gear fluids, and industrial specialty applications, such as turbine oils.It also provides fuel additives that are used to enhance the oil refining process and the performance of gasoline, diesel, biofuels, and other fuels to industry, government, original equipment manufacturers, and individual customers.


In addition, the company engages in the antiknock compounds business, as well as contracted manufacturing and services activities; and owns and manages a real property in Virginia.It operates in North America, Latin America, the Asia Pacific, Europe, the Middle East, Africa, and India.NewMarket Corporation was founded in 1887 and is headquartered in Richmond, Virginia.

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1.b. Last Insights on NEU

NewMarket Corporation's recent performance was driven by strong quarterly results, with the company reporting its Q2 2025 earnings. Afton Chemical, a subsidiary, launched HiTEC 65522 Gasoline Performance Additive Series, approved for TOP TIER+ gasoline, targeting GDI engines. This new product expansion enhances the company's portfolio. Additionally, the company's financial leadership, with Timothy K. Fitzgerald as VP & CFO, continues to oversee its operations. The upcoming release of quarterly results and conference call also contributed to investor focus on the company.

1.c. Company Highlights

2. NewMarket Corporation's Q3 2025 Earnings: A Closer Look

NewMarket Corporation reported a net income of $100 million or $10.67 per share for Q3 2025, compared to $132 million or $13.79 per share for Q3 2024. The actual EPS came out at $6.06, beating estimates of $5.93. For the quarter, petroleum additives sales were $649 million, down from $663 million in Q3 2024, resulting in an operating profit of $131 million, compared to $157 million in Q3 2024. The decrease was primarily driven by one-time charges related to optimizing the global manufacturing network. The company's net income for the first 9 months of 2025 was $337 million, or $35.78 per share, compared to $352 million or $36.66 per share for the same period in 2024.

Publication Date: Nov -25

📋 Highlights
  • Q3 2025 Net Income Decline:: Net income fell to $100 million ($10.67/share) from $132 million ($13.79/share) in Q3 2024, a 24% drop.
  • Petroleum Additives Profit Margin Compression:: Operating profit dropped 17% to $131 million in Q3 2025, driven by 4.1% lower shipments and $157 million in optimization charges.
  • YTD 2025 Operating Profit Decline:: First 9 months operating profit fell 9% to $413 million ($213 million in Petroleum Additives, $6 million in Specialty Materials).
  • Shareholder Returns Strengthened:: Returned $155 million to shareholders via $77 million in buybacks and $78 million in dividends, while reducing net debt by $213 million.
  • Dividend Hike & Future Investments:: Boosted quarterly dividend by 9% to $3/share and committed $1 billion to Specialty Materials through acquisitions and R&D.

Segment Performance

Petroleum additives sales for the first 9 months of 2025 were $1.9 billion, compared to $2 billion for the same period in 2024, with operating profit of $413 million, down from $456 million. Specialty Materials sales for Q3 2025 were $38 million, down from $59 million in Q3 2024, with operating profit of $6 million, compared to $16 million in Q3 2024. The decline in Specialty Materials was a significant contributor to the overall decrease in operating profit.

Cash Flow and Dividend

The company generated solid cash flows, returning $155 million to shareholders through share repurchases of $77 million and dividends of $78 million. NewMarket Corporation also reduced net debt by $213 million, driving the net debt-to-EBITDA ratio down to 0.9x as of September 30, 2025. The Board of Directors approved a 9% increase in the quarterly dividend, from $2.75 per share to $3 per share, payable January 2, 2026.

Valuation and Outlook

With a P/E Ratio of 15.81 and an EV/EBITDA of 11.97, the company's valuation appears reasonable. Analysts estimate next year's revenue growth at 0.5%. The company's commitment of approximately $1 billion to the Specialty Materials segment through acquisitions and investments is expected to drive future growth. As the company continues to optimize its global manufacturing network, it is likely to reap benefits in the long run. The company's ROIC of 15.37% and ROE of 28.53% indicate a strong ability to generate returns on invested capital.

Growth Prospects

The company's investment in the Specialty Materials segment is expected to drive future growth. NewMarket Corporation's strong cash flow generation and reduced net debt-to-EBITDA ratio provide a solid foundation for future investments. The increase in dividend payout also reflects the company's confidence in its future prospects.

3. NewsRoom

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Advisors Asset Management Inc. Takes Position in NewMarket Corporation $NEU

Dec -03

Source: defenseworld.net

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Aristides Capital LLC Makes New $263,000 Investment in NewMarket Corporation $NEU

Nov -27

Source: defenseworld.net

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Touchstone Mid Cap Fund Q3 2025 Portfolio Review

Nov -24

Source: seekingalpha.com

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Q3 2025 Portfolio: Focusing On Resilience, Attractive Valuation And Sound Capital Allocation

Nov -11

Source: seekingalpha.com

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The London Company SMID Cap Vs. Russell 2500 Q3 2025 Top Contributors And Detractors

Nov -05

Source: seekingalpha.com

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Financial Review: Linde (NASDAQ:LIN) & NewMarket (NYSE:NEU)

Nov -05

Source: defenseworld.net

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ADP, Snap-on Lead 14 Companies To Announce Annual Increases In First Half Of November

Nov -02

Source: seekingalpha.com

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NewMarket Corporation (NEU) Q3 2025 Earnings Call Prepared Remarks Transcript

Oct -31

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.50%)

6. Segments

Petroleum Additives

Expected Growth: 4.5%

Growing demand for high-performance fuels and lubricants, increasing adoption of electric vehicles, and stringent emissions regulations drive the growth of petroleum additives market.

All Other

Expected Growth: 4.5%

The All Other segment, comprising lubricant and fuel ingredient businesses, is expected to grow driven by increasing demand for high-performance lubricants, expansion into new markets, and strategic partnerships.

7. Detailed Products

Petroleum Additives

NewMarket Corporation's petroleum additives are used to enhance the performance of fuels and lubricants, improving fuel efficiency, reducing emissions, and extending the life of engines and equipment.

Fuel Additives

NewMarket Corporation's fuel additives are designed to improve fuel efficiency, reduce emissions, and enhance fuel stability, making them ideal for use in gasoline, diesel, and alternative fuels.

Lubricant Additives

NewMarket Corporation's lubricant additives are used to enhance the performance of lubricants, reducing wear and tear on engines and equipment, and improving fuel efficiency.

Specialty Chemicals

NewMarket Corporation's specialty chemicals are used in a variety of applications, including the manufacturing of fuels, lubricants, and other industrial products.

8. NewMarket Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

NewMarket Corporation operates in the petroleum additives industry, which has a moderate threat of substitutes. While there are some substitutes available, they are not as effective as NewMarket's products, and the company's strong brand recognition and customer loyalty help to mitigate the threat.

Bargaining Power Of Customers

NewMarket Corporation's customers are largely industrial companies, which have limited bargaining power due to their dependence on the company's products. Additionally, the company's strong relationships with its customers and its ability to provide customized solutions help to reduce the bargaining power of customers.

Bargaining Power Of Suppliers

NewMarket Corporation relies on a few key suppliers for its raw materials, which gives them some bargaining power. However, the company's strong relationships with its suppliers and its ability to negotiate contracts help to mitigate this threat.

Threat Of New Entrants

The petroleum additives industry has high barriers to entry, including significant capital requirements and the need for specialized expertise. Additionally, NewMarket Corporation's strong brand recognition and customer loyalty make it difficult for new entrants to gain traction in the market.

Intensity Of Rivalry

The petroleum additives industry is highly competitive, with several established players competing for market share. NewMarket Corporation faces intense competition from companies such as Afton Chemical and Chevron Oronite, which can lead to pricing pressure and reduced market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 40.52%
Debt Cost 6.40%
Equity Weight 59.48%
Equity Cost 6.51%
WACC 6.47%
Leverage 68.11%

11. Quality Control: NewMarket Corporation passed 7 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
NewMarket

A-Score: 6.7/10

Value: 4.5

Growth: 7.2

Quality: 7.2

Yield: 3.0

Momentum: 9.5

Volatility: 8.7

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Cabot

A-Score: 5.5/10

Value: 7.1

Growth: 6.4

Quality: 6.0

Yield: 5.0

Momentum: 1.0

Volatility: 7.7

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RPM International

A-Score: 5.2/10

Value: 3.6

Growth: 6.6

Quality: 5.7

Yield: 4.0

Momentum: 3.0

Volatility: 8.7

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Balchem

A-Score: 4.7/10

Value: 1.9

Growth: 5.6

Quality: 7.5

Yield: 1.0

Momentum: 2.5

Volatility: 9.7

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Innospec

A-Score: 4.3/10

Value: 3.4

Growth: 4.1

Quality: 5.4

Yield: 3.0

Momentum: 1.0

Volatility: 9.0

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Olin

A-Score: 3.7/10

Value: 5.5

Growth: 4.4

Quality: 2.0

Yield: 6.0

Momentum: 0.5

Volatility: 3.7

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

766.42$

Current Price

766.42$

Potential

-0.00%

Expected Cash-Flows