Hudson Technologies Inc /Ny (NASDAQ: HDSN)

Sector: Basic Materials Industry: Specialty Chemicals CIK: 0000925528
Market Cap 320.48 Mn
P/B 1.21
P/E 14.10
P/S 1.35
ROIC (Qtr) 7.60
Div Yield % 0.00
Rev 1y % (Qtr) 19.48
Total Debt (Qtr) 3.49 Mn
Debt/Equity (Qtr) 0.01

About

Hudson Technologies, Inc., or Hudson, operates in the refrigeration industry, providing innovative solutions to recurring problems within this sector. The company's full name is Hudson Technologies, Inc., and it trades under the ticker symbol HDSN. Its headquarters are located in Woodcliff Lake, New Jersey, and it operates in a highly regulated environment subject to various federal and state laws and regulations. Hudson's primary business activities involve the sale of refrigerants, reclamation and management of refrigerants, and provision of...

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Price action

Investment thesis

Bull case

  • Strong operating cash flow of 50.09M provides robust 14.36x coverage of total debt 3.49M, indicating excellent debt servicing capability and financial flexibility.
  • Strong tangible asset base of 265.03M provides 75.98x coverage of total debt 3.49M, indicating robust asset backing and low credit risk.
  • Operating cash flow of 50.09M provides strong 75.32x coverage of stock compensation 665000, indicating sustainable incentive practices.
  • Robust free cash flow of 44.60M exceeds capital expenditure of 5.49M by 8.12x, indicating strong organic growth funding capability.
  • Retained earnings of 159.91M provide full 45.85x coverage of long-term debt 3.49M, indicating strong internal capital position.

Bear case

  • Operating cash flow of 50.09M barely covers its investment activities of (5.49M), with a coverage ratio of -9.12, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 50.09M is outpaced by equity issuance of (11.29M) (-4.44 ratio), indicating concerning reliance on equity markets for funding operations.
  • Tangible assets of 265.03M provide limited backing for working capital of 170.33M, which is 1.56x, suggesting increased operational risk in market downturns.
  • Cash position of 89.68M provides only -35.22x coverage of interest expenses of (2.55M), indicating potential refinancing risks in a rising rate environment.
  • R&D investment of 0 represents just 0x of SG&A expenses of 34.32M, indicating potential underinvestment in innovation relative to administrative overhead.

Peer comparison

Companies in the Specialty Chemicals
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 LIN Linde Plc 218.63 Bn 38.41 6.61 25.93 Bn
2 SHW Sherwin Williams Co 110.34 Bn 170.54 11.54 13.58 Bn
3 ECL Ecolab Inc. 80.35 Bn 80.18 5.93 8.67 Bn
4 APD Air Products & Chemicals, Inc. 56.37 Bn 48.29 5.86 18.31 Bn
5 PPG Ppg Industries Inc 34.00 Bn 31.05 2.58 7.91 Bn
6 LYB LyondellBasell Industries N.V. 17.46 Bn 5.03 0.49 13.22 Bn
7 DD DuPont de Nemours, Inc. 16.63 Bn 3.65 0.32 8.90 Bn
8 ALB Albemarle Corp 14.44 Bn 48.94 6.36 3.63 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.71 1.52
EV to Cash from Ops. EV/CFO 4.79 12.52
EV to Debt EV to Debt 68.84 13.65
EV to EBIT EV/EBIT 8.54 21.45
EV to EBITDA EV/EBITDA 7.31 14.82
EV to Free Cash Flow [EV/FCF] EV/FCF 5.38 29.24
EV to Market Cap EV to Market Cap 0.75 3.84
EV to Revenue EV/Rev 1.01 89.11
Price to Book Value [P/B] P/B 1.21 5.48
Price to Earnings [P/E] P/E 14.10 16.02
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 -5.31
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 -75.74
Dividend per Basic Share Div per Share (Qtr) 0.00 1.25
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 23.50
Interest Coverage Int. cover (Qtr) -11.05 -8.92
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -7.29 -1.67
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 58.76 72.99
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 -3.00
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -33.03 -31.21
EBITDA Growth (1y) % EBITDA 1y % (Qtr) -24.34 51.49
EBIT Growth (1y) % EBIT 1y % (Qtr) -28.87 0.57
EBT Growth (1y) % EBT 1y % (Qtr) -21.85 -80.35
EPS Growth (1y) % EPS 1y % (Qtr) -22.39 -90.82
FCF Growth (1y) % FCF 1y % (Qtr) -44.95 -50.40
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -12.96 219.02
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.70 0.70
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.41
Cash Ratio Cash Ratio (Qtr) 1.40 1.28
Current Ratio Curr Ratio (Qtr) 3.66 3.42
Debt to Equity Ratio Debt/Equity (Qtr) 0.01 0.92
Interest Cover Ratio Int Coverage (Qtr) -11.05 -8.92
Times Interest Earned Times Interest Earned (Qtr) -11.05 -8.92
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 14.50 -333.97
EBIT Margin % EBIT Margin % (Qtr) 11.87 -374.34
EBT Margin % EBT Margin % (Qtr) 12.95 -379.75
Gross Margin % Gross Margin % (Qtr) 27.20 29.26
Net Profit Margin % Net Margin % (Qtr) 9.60 -380.67