DMC Global Inc. (BOOM) Stock Analysis and Metrics

Sector: Industrials Industry: Conglomerates CIK: 0000034067

Market Cap 36.64 Mn

P/B 0.14

P/E -18.39

P/S 0.06

ROIC (Qtr) 4.32

Div Yield % 0.00

Rev 1y % (Qtr) -0.59

Total Debt (Qtr) 56.53 Mn

Debt/Equity (Qtr) 0.22

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About

DMC Global Inc., also known as BOOM, operates in the manufacturing industry, providing differentiated products and engineered solutions to various markets. The company's main businesses include Arcadia Products, DynaEnergetics, and NobelClad, which operate in the construction, energy, industrial processing, and transportation industries. Arcadia Products is a leading manufacturer of architectural building products, including exterior and interior framing systems, windows, curtain walls, storefronts, doors, and interior partitions. The company operates...

DMC Global Inc., also known as BOOM, operates in the manufacturing industry, providing differentiated products and engineered solutions to various markets. The company's main businesses include Arcadia Products, DynaEnergetics, and NobelClad, which operate in the construction, energy, industrial processing, and transportation industries.

Arcadia Products is a leading manufacturer of architectural building products, including exterior and interior framing systems, windows, curtain walls, storefronts, doors, and interior partitions. The company operates through three divisions: Arcadia, Wilson Partitions, and Arcadia Custom. Arcadia designs, engineers, fabricates, and finishes aluminum framing systems, windows, curtain walls, storefronts, and entrance systems for the commercial exteriors market. Wilson Partitions serves the commercial interior framing and partitions markets, while Arcadia Custom serves the ultra-high-end residential real estate market. Arcadia Products caters to the construction industry, providing high-quality building products that meet the needs of architects, builders, and homeowners.

DynaEnergetics is a leading manufacturer of perforating systems and associated hardware for the global oil and gas industry. The company designs, manufactures, and sells perforating systems, shaped charges, and detonators for use in the completion of oil and gas wells. DynaEnergetics' products are used in the perforation of oil and gas wells, as well as in the completion of unconventional wells. DynaEnergetics operates in the energy industry, providing critical products and services to oil and gas companies.

NobelClad is a leader in the production of explosion-welded clad metal plates for use in the construction of corrosion-resistant industrial processing equipment, as well as specialized transition joints for use in construction of commuter rail cars, ships, and liquefied natural gas (LNG) processing equipment. NobelClad caters to the industrial processing and transportation industries, providing high-quality products that meet the needs of manufacturers and operators of industrial equipment.

DMC Global Inc. generates revenue through the sale of its products and services to various customers, including oil and gas companies, construction companies, and industrial processing companies. The company's products are designed to provide differentiated solutions to its customers, and its competitive advantages include its low-cost manufacturing platform, supply chain management, broad product offering, product quality, and availability.

The company's position within the industry is strong, with a reputation for providing high-quality products and services. DMC Global Inc. competes with other companies in the industry, including independent manufacturers of perforating products and the industry's three largest oil and gas service companies. The company's customers are primarily oil and gas companies, construction companies, and industrial processing companies, and they select products based on factors such as customer service, product quality, reliability, safety, performance, and price.

In terms of environmental sustainability, Arcadia Products has an ongoing focus on environmental sustainability, including hazardous waste recycling and initiatives aimed at reducing waste. The company's products are made from aluminum, including recycled aluminum content, and many of its residential projects use stainless steel, which is the most recycled building material in the world.

DMC Global Inc. is committed to providing a safe and healthy work environment for its employees. The company has a strong safety culture and has implemented various safety measures to prevent accidents and injuries. The company also has a comprehensive training program in place to ensure that its employees have the necessary skills and knowledge to perform their jobs safely and effectively.

In addition to its safety record, DMC Global Inc. is also committed to diversity and inclusion. The company has a diverse workforce and believes that diversity and inclusion are essential to its success. The company has a formal diversity and inclusion policy in place and provides training and development opportunities to its employees to promote diversity and inclusion.

DMC Global Inc.'s brand names and/or trade names of its products and services include Arcadia Products, DynaEnergetics, and NobelClad. These brands are well-known and respected in their respective industries, and the company is committed to maintaining and enhancing their reputation for quality, reliability, and innovation.

Investment thesis

Bull case

Strong operating cash flow of 50.15M provides robust 0.89x coverage of total debt 56.53M, indicating excellent debt servicing capability and financial flexibility.
Healthy cash reserves of 26.41M provide 8.45x coverage of short-term debt 3.12M, demonstrating strong liquidity position and minimal refinancing risk.
Operating cash flow of 50.15M provides exceptional 52.79x coverage of minority interest expenses 950000, showing strong core operations.
Strong tangible asset base of 484.33M provides 8.57x coverage of total debt 56.53M, indicating robust asset backing and low credit risk.
Robust free cash flow of 37.84M exceeds capital expenditure of 12.31M by 3.07x, indicating strong organic growth funding capability.

Bear case

Operating cash flow of 50.15M barely covers its investment activities of (8.14M), with a coverage ratio of -6.16, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
With cash reserves of 26.41M against inventory of 140.54M, the 0.19 cash-to-inventory ratio suggests potential liquidity risks if inventory turnover slows, particularly concerning given current supply chain volatilities.
Operating earnings of 8.62M show weak coverage of depreciation charges of 34.27M, with a 0.25 ratio indicating high capital intensity and potential reinvestment needs.
Free cash flow of 37.84M represents just -2.03x of debt issuance (18.67M), suggesting concerning reliance on leverage rather than internal cash generation for growth.
High depreciation of 34.27M relative to operating cash flow of 50.15M, which is 0.68x suggests significant maintenance capital requirements affecting free cash flow.

Consolidation Items Breakdown of Revenue (2024)

Segments Breakdown of Revenue (2024)

Peer comparison

Companies in the Conglomerates

S.No.	Ticker	Company	Market Cap	P/E	P/S	Total Debt (Qtr)
1	HON	Honeywell International Inc	155.07 Bn	32.79	4.14	34.58 Bn
2	MMM	3M Co	100.16 Bn	20.62	3.16	12.60 Bn
3	VMI	Valmont Industries Inc	11.52 Bn	79.14	5.93	0.86 Bn
4	SEB	Seaboard Corp /De/	4.74 Bn	9.55	0.49	1.82 Bn
5	MDU	Mdu Resources Group Inc	3.80 Bn	15.84	0.97	2.35 Bn
6	OTTR	Otter Tail Corp	3.60 Bn	20.35	3.01	1.04 Bn
7	BBU	Brookfield Business Partners L.P.	2.64 Bn	-19.71	0.10	43.31 Bn
8	TTI	Tetra Technologies Inc	1.44 Bn	11.77	2.33	0.21 Bn

Industry comparisons

Current Valuation	Value	Ind Avg
EV to Assets EV to Assets	0.13	1.07
EV to Cash from Ops. EV/CFO	1.65	26.27
EV to Debt EV to Debt	1.47	3.17
EV to EBIT EV/EBIT	9.61	28.37
EV to EBITDA EV/EBITDA	1.86	2.98
EV to Free Cash Flow [EV/FCF] EV/FCF	2.19	24.12
EV to Market Cap EV to Market Cap	2.26	2.07
EV to Revenue EV/Rev	0.13	3.10
Price to Book Value [P/B] P/B	0.14	0.16
Price to Earnings [P/E] P/E	-18.39	-51.36

Dividend Metrics	Value	Ind Avg
Dividend Coverage Ratio Div Coverage (Qtr)	0.00	2.51
Dividend Payout Ratio % Div Payout % (Qtr)	0.00	16.94
Dividend per Basic Share Div per Share (Qtr)	0.00	1.03
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr)	0.00	-1.97
Interest Coverage Int. cover (Qtr)	1.22	4.08

Growth Metrics	Value	Ind Avg
Capex Growth (1y) % Capex 1y % (Qtr)	36.13	-245.15
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr)	82.01	116.15
Dividend Growth (1y) % Div 1y % (Qtr)	0.00	-1.11
EBIAT Growth (1y) % EBIAT 1y % (Qtr)	86.46	233.90
EBITDA Growth (1y) % EBITDA 1y % (Qtr)	151.90	6.29
EBIT Growth (1y) % EBIT 1y % (Qtr)	112.55	58.90
EBT Growth (1y) % EBT 1y % (Qtr)	102.01	-70.32
EPS Growth (1y) % EPS 1y % (Qtr)	94.26	179.10
FCF Growth (1y) % FCF 1y % (Qtr)	-2.20	22.76
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr)	-13.25	19.56

Liquidity Ratios	Value	Ind Avg
Asset Utilization Ratio Asset Util Ratio (Qtr)	0.96	0.64
Cash Payout Ratio Cash Payout (Qtr)	0.00	-0.01
Cash Ratio Cash Ratio (Qtr)	0.25	0.34
Current Ratio Curr Ratio (Qtr)	2.76	1.70
Debt to Equity Ratio Debt/Equity (Qtr)	0.22	-5.62
Interest Cover Ratio Int Coverage (Qtr)	1.22	4.08
Times Interest Earned Times Interest Earned (Qtr)	1.22	4.08

Profitability	Value	Ind Avg
EBITDA Margin % EBITDA Margin % (Qtr)	6.90	-14.03
EBIT Margin % EBIT Margin % (Qtr)	1.39	-16.67
EBT Margin % EBT Margin % (Qtr)	0.25	-20.17
Gross Margin % Gross Margin % (Qtr)	23.00	21.90
Net Profit Margin % Net Margin % (Qtr)	-0.30	-21.67

Research Tools

DMC Global Inc. (NASDAQ: BOOM)

About

Investment thesis

Bull case

Bear case

Consolidation Items Breakdown of Revenue (2024)

Segments Breakdown of Revenue (2024)

Peer comparison

Industry comparisons

Research Tools

DMC Global Inc. (NASDAQ: BOOM)

About

Investment thesis

Bull case

Bear case

Consolidation Items Breakdown of Revenue (2024)

Segments Breakdown of Revenue (2024)

Peer comparison

Industry comparisons

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