Valhi, Inc. (VHI) | Investment Case

1. Company Snapshot

1.a. Company Description

Valhi, Inc.engages in the chemicals, component products, and real estate management and development businesses in the Asia Pacific, Europe, North America, and internationally.The company's Chemicals segment produces and markets titanium dioxide pigments (TiO2), which are white inorganic pigments used in various applications by paint, plastics, decorative laminate, and paper manufacturers.

It offers TiO2 under the KRONOS name through agents and distributors.The company's Component Products segment manufactures mechanical and electrical cabinet locks, and other locking mechanisms for use in ignition systems, mailboxes, file cabinets, desk drawers, tool storage cabinets, vending and cash containment machines, integrated inventory and access control secured narcotics boxes, medical cabinetry security, electronic circuit panels, storage compartments, and gas station security applications.It also provides stainless steel exhaust components, gauges, throttle controls, wake enhancement systems, trim tabs, and related hardware and accessories primarily for performance and ski/wakeboard boats.

The company's Real Estate Management and Development segment offers utility services to industrial and municipal customers; owns real properties; and develops land holdings for commercial, industrial, and residential purposes.It also holds marketable securities and other investments.The company was incorporated in 1932 and is based in Dallas, Texas.

Valhi, Inc.is a subsidiary of Contran Corporation.

Show Full description

1.b. Last Insights on VHI

Valhi's recent performance was negatively impacted by a non-cash deferred income tax expense of $16.5 million due to final tax regulations on the Chemicals Segment's treatment of certain currency translation gains and losses. Additionally, the recognition of a deferred income tax asset valuation allowance related to the Chemicals Segment's Belgian net deferred tax assets resulted in a non-cash deferred income tax expense of $8.2 million. These tax-related expenses offset the positive impact of higher operating results from the Chemicals Segment and the settlement of a liability for an environmental remediation site.

1.c. Company Highlights

Last Price	12.9
Change Percentage	4.96%
Open	12.42
Previous Close	12.29
Market Cap ( Millions)	365
Volume	99995
Year High	25.44
Year Low	11.94
M A 50	13.92
M A 200	15.92

FCF Yield	-37.96%
Dividend Yield	2.48%
ROE	1.75%
Debt / Equity	63.23%
Net Debt / EBIDTA	339.47%
Price To Book	0.35
Price Earnings Ratio	19.98
Price To FCF	-2.63
Price To sales	0.17
EV / EBITDA	5.27

2. Transcript Summary

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3. NewsRoom

Valhi: Lower Selling Prices And Volumes

Dec -02

Source: seekingalpha.com

Contrasting Valhi (NYSE:VHI) & Koppers (NYSE:KOP)

Dec -02

Source: defenseworld.net

Vitalhub Corp. (VHI:CA) Q3 2025 Earnings Call Transcript

Nov -07

Source: seekingalpha.com

VALHI DECLARES QUARTERLY DIVIDEND

Nov -06

Source: globenewswire.com

VALHI REPORTS THIRD QUARTER 2025 RESULTS

Nov -06

Source: globenewswire.com

VALHI ANNOUNCES EXPECTED THIRD QUARTER 2025 EARNINGS RELEASE DATE

Oct -14

Source: globenewswire.com

VALHI ANNOUNCES EXPECTED THIRD QUARTER 2025 EARNINGS RELEASE DATE

Oct -14

Source: globenewswire.com

VitalHub Announces Novari Health Deployment in the UK

Oct -09

Source: globenewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (10.03%)

6. Segments

Chemicals

Expected Growth: 10%

Valhi, Inc.'s Chemicals segment growth is driven by increasing demand for titanium dioxide, a key pigment in paints and coatings, as well as growing adoption of lithium-ion batteries. Additionally, strategic acquisitions and expansion into high-growth markets, such as Asia, contribute to the segment's 10% growth.

Component Products

Expected Growth: 11%

Valhi's Component Products segment, with 11% growth, is driven by increasing demand for titanium dioxide pigment in the coatings and plastics industries, coupled with strategic pricing initiatives and operational efficiencies. Additionally, the segment benefits from a strong presence in the automotive and construction markets, which are experiencing a resurgence in growth.

Real Estate Management and Development

Expected Growth: 9%

Valhi, Inc.'s Real Estate Management and Development segment growth is driven by increasing demand for commercial and residential properties, strategic acquisitions, and effective asset management. Additionally, the company's focus on redevelopment and repositioning of existing properties, as well as its strong relationships with tenants and partners, contribute to its 9% growth.

7. Detailed Products

CompX

CompX is a specialty chemicals company that provides a wide range of products, including titanium dioxide, functional additives, and color pigments.

NL Industries

NL Industries is a leading producer of titanium dioxide, a pigment used in coatings, plastics, and paper.

Kronos

Kronos is a leading producer of titanium dioxide, a pigment used in coatings, plastics, and paper.

Tinuum

Tinuum is a leading provider of waste management and environmental services, including landfill gas capture and utilization.

Waste Management

Waste Management is a leading provider of waste management and environmental services, including collection, transfer, and disposal of waste.

CompX Security Products

CompX Security Products is a leading provider of security products, including locks, hinges, and other security-related products.

8. Valhi, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Valhi, Inc. operates in a industry with moderate threat of substitutes. The company's products are not easily substitutable, but there are some alternatives available in the market.

Bargaining Power Of Customers

Valhi, Inc. has a diverse customer base, which reduces the bargaining power of individual customers. The company's products are also customized to meet specific customer needs, making it difficult for customers to switch to alternative suppliers.

Bargaining Power Of Suppliers

Valhi, Inc. has a moderate level of bargaining power over its suppliers. The company relies on a few key suppliers for raw materials, but it also has some flexibility to switch to alternative suppliers if needed.

Threat Of New Entrants

The threat of new entrants in Valhi, Inc.'s industry is low due to high barriers to entry, including significant capital requirements and regulatory hurdles.

Intensity Of Rivalry

The intensity of rivalry in Valhi, Inc.'s industry is high due to the presence of several established competitors. The company must continually innovate and improve its products and services to maintain its market share.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	37.03%
Debt Cost	3.95%
Equity Weight	62.97%
Equity Cost	10.99%
WACC	8.38%
Leverage	58.82%

11. Quality Control: Valhi, Inc. passed 3 out of 9 key points

Strong Liquidity

Low Deb

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

FutureFuel

A-Score: 4.7/10

Value: 8.8

Growth: 2.0

Quality: 1.7

Yield: 10.0

Momentum: 0.5

Volatility: 5.0

1-Year Total Return ->

Valhi

A-Score: 4.5/10

Value: 9.5

Growth: 3.1

Quality: 5.9

Yield: 4.0

Momentum: 0.5

Volatility: 3.7

1-Year Total Return ->

AdvanSix

A-Score: 4.4/10

Value: 7.7

Growth: 2.9

Quality: 4.1

Yield: 4.0

Momentum: 1.5

Volatility: 6.0

1-Year Total Return ->

LSB Industries

A-Score: 3.8/10

Value: 8.1

Growth: 2.8

Quality: 5.0

Yield: 0.0

Momentum: 3.0

Volatility: 3.7

1-Year Total Return ->

ASP Isotopes

A-Score: 3.4/10

Value: 6.0

Growth: 1.4

Quality: 3.0

Yield: 0.0

Momentum: 9.5

Volatility: 0.3

1-Year Total Return ->

Rayonier Advanced Materials

A-Score: 3.1/10

Value: 6.6

Growth: 3.8

Quality: 0.9

Yield: 0.0

Momentum: 4.0

Volatility: 3.3

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

22.34%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

8.38%

Valhi, Inc. - US9189052098

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on VHI

1.c. Company Highlights

Lower Quality

Average Growth

Medium Volatility

Earnings Beats

Average Quality

Lower Growth

More Volatile

Strong Momentum

Fairly Valued

Cheaper

Earnings Miss

Stable Momentum

Weak Momentum

2. Transcript Summary

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (10.03%)

6. Segments

Chemicals

Expected Growth: 10%

Component Products

Expected Growth: 11%

Real Estate Management and Development

Expected Growth: 9%

7. Detailed Products

CompX

NL Industries

Kronos

Tinuum

Waste Management

CompX Security Products

8. Valhi, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Valhi, Inc. passed 3 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

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

12.9$

Current Price

12.9$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA