MeritValue

Element Solutions Inc

ESIdata completeness 100%13 fiscal years on file
The thesis, from the filings

Element Solutions Inc earns about 4% on invested capital, below its ~9% cost of capital, and has bought back 2% of its shares over 5 years — no moat visible in the numbers. The estimate methods put fair value between $8.16 and $16.87 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$2.4B1$2.55B2$2.33B3$2.46B3$2.55B3
Net income$203.7M4$187.2M5$118.1M6$244.2M6$190.8M6
Operating cash flow$326M7$295.9M7$333.6M8$362M8$289.8M8
Capital expenditure$46.3M9$47.8M10$52.7M11$68.4M11$62.2M11
Free cash flow (derived)$279.7M7$248.1M7$280.9M8$293.6M8$227.6M8
Total debt$1.93B12$1.91B13$1.95B14$1.84B15$1.64B16
Cash & equivalents$330.1M17$265.6M18$289.3M19$359.4M20$626.5M20
Diluted shares247.9M245.8M241.8M242.6M242.4M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$110.33
your share of equity
Profit it earned you last year
$7.87
Free cash flow it threw off
$9.39
Debt you’d be carrying
$67.5

10 shares is a claim on $110.33 of net worth that earned you $7.87 and generated $9.39 of cash last year, against $67.5 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
4% avg · 5y
FY21 4%FY22 4%FY23 2%FY24 5%FY25 4%

It earned about 4% on invested capital against a ~9% cost of capital — below the cost of funding. The numbers show no moat.

seeing a moat in the numbers →
Management signal · capital allocation
−2% shares · 5y

Share count is down 2% over 5 years — management has been buying back stock, quietly handing owners a bigger slice. Total debt has fallen 15% — deleveraging.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 3 estimate methods that apply put fair value between $8.16 and $16.87 a share. They rest on different assumptions, so where they diverge is the story; the Graham Number is a stricter floor, not a target.

DCF · Growth Exit 10Y
$16.87
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth4.2%
  • fcfBase$280.9M
DCF · Growth Exit 5Y
$15.73
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth4.2%
  • fcfBase$280.9M
Earnings Power Value
$8.16
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$190.8M
  • growthAssumed0.0%
Graham Number
$14
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years4.2%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $15.73
The three cases
Bear0.0%$12.39
Base4.2%$15.73
Bull9.2%$20.4

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 4.2%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0001590714-24-000054 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0001590714-25-000022 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0001590714-26-000018 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0001590714-24-000054 (ProfitLoss)
  5. 10-K · period ending 2022-12-31 · accession 0001590714-25-000022 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0001590714-26-000018 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0001590714-23-000027 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2023-12-31 · accession 0001590714-26-000018 (NetCashProvidedByUsedInOperatingActivitiesContinuingOperations)
  9. 10-K · period ending 2021-12-31 · accession 0001590714-24-000054 (PaymentsToAcquirePropertyPlantAndEquipment)
  10. 10-K · period ending 2022-12-31 · accession 0001590714-25-000022 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2023-12-31 · accession 0001590714-26-000018 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2021-12-31 · accession 0001590714-22-000029 (LongTermDebt)
  13. 10-K · period ending 2022-12-31 · accession 0001590714-23-000027 (LongTermDebt)
  14. 10-K · period ending 2023-12-31 · accession 0001590714-24-000054 (LongTermDebt)
  15. 10-K · period ending 2024-12-31 · accession 0001590714-25-000022 (LongTermDebt)
  16. 10-K · period ending 2025-12-31 · accession 0001590714-26-000018 (LongTermDebt)
  17. 10-K · period ending 2021-12-31 · accession 0001590714-23-000027 (CashAndCashEquivalentsAtCarryingValue)
  18. 10-K · period ending 2022-12-31 · accession 0001590714-24-000054 (CashAndCashEquivalentsAtCarryingValue)
  19. 10-K · period ending 2023-12-31 · accession 0001590714-25-000022 (CashAndCashEquivalentsAtCarryingValue)
  20. 10-K · period ending 2024-12-31 · accession 0001590714-26-000018 (CashAndCashEquivalentsAtCarryingValue)