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Matthews International (MATW)
NASDAQ:MATW
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Matthews International
(NASDAQ:MATW)47Neutral
Matthews International (MATW) vs. S&P 500 (SPY)
Market Cap
$761.83M
Dividend Yield3.98%
Average Volume (3M)297.86K
Price to Earnings (P/E)―
Beta (1Y)0.84
Revenue Growth-4.53%
EPS Growth-252.80%
CountryUS
Employees11,000
SectorIndustrials
Sector Strength66
IndustryIndustrial Conglomerates
Share Statistics
EPS (TTM)-1.97
Shares Outstanding30,968,685
10 Day Avg. Volume240,720
30 Day Avg. Volume297,863
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.44
Price to Cash Flow (P/CF)-7.60
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$40.00Price Target Upside62.60% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
Matthews International Business Overview & Revenue Model
Company DescriptionMatthews International Corporation (MATW) is a global provider of brand solutions, memorialization products, and industrial technologies. The company operates through three primary segments: SGK Brand Solutions, Memorialization, and Industrial Technologies. SGK Brand Solutions offers graphic design, packaging solutions, and brand management services to help businesses enhance and protect their brand identities. The Memorialization segment provides products such as memorials, caskets, and cremation equipment for the cemetery and funeral home industries. The Industrial Technologies segment offers marking and coding solutions, as well as automation technologies for various industrial applications.
How the Company Makes MoneyMatthews International generates revenue through its diverse range of products and services across its three main business segments. In the SGK Brand Solutions segment, the company earns money by providing branding and packaging services to consumer goods companies, which pay for expertise in enhancing their brand image and packaging design. The Memorialization segment makes money by selling memorial products, such as headstones and caskets, to cemeteries and funeral homes, as well as cremation and incineration equipment. The Industrial Technologies segment contributes to the company's earnings by selling marking and coding equipment and providing automation solutions to a variety of industries. Matthews International also benefits from strategic partnerships and long-term contracts with clients in each of its sectors, contributing to stable and recurring revenue streams.
Matthews International Financial Statement Overview
Summary
Matthews International faces significant financial challenges, with declining revenue and negative margins impacting profitability. High leverage and inconsistent free cash flow growth further strain financial stability, despite some positive cash flow management trends.Income Statement
Matthews International has faced significant challenges in recent periods, with declining revenue and negative net income impacting profitability. The gross profit margin remains moderate, but the company struggles with negative net and EBIT margins in the TTM period. Revenue growth has been inconsistent, reflecting volatility in business operations.45
Neutral
Balance Sheet
The balance sheet indicates high leverage with a debt-to-equity ratio exceeding 2, showing risk from substantial debt levels. Stockholders' equity has decreased, reflecting strain on financial stability. While the equity ratio has deteriorated, the company's ability to maintain assets offers some resilience.55
Neutral
Cash Flow
Despite operating cash flow covering net income, free cash flow growth has been inconsistent. Recent periods show positive free cash flow, indicating some ability to manage expenditures. However, the company's cash flow generation is volatile, reflecting operational challenges.60
Neutral
| Breakdown | |||||
| TTM | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 | Sep 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 1.75B | 1.80B | 1.88B | 1.76B | 1.67B | 1.50B | Gross Profit |
| 516.09M | 529.71M | 577.67M | 522.28M | 541.83M | 497.77M | EBIT |
| -7.88M | -12.32M | 88.12M | 120.97M | 42.03M | 26.21M | EBITDA |
| 77.48M | 75.65M | 195.21M | 24.43M | 169.71M | 46.09M | Net Income Common Stockholders |
| -60.83M | -59.66M | 39.29M | -99.83M | 2.91M | -87.65M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 33.51M | 40.82M | 42.10M | 69.02M | 49.18M | 41.33M | Total Assets |
| 1.79B | 1.83B | 1.89B | 1.88B | 2.03B | 2.07B | Total Debt |
| 873.40M | 839.16M | 864.35M | 798.57M | 763.71M | 834.53M | Net Debt |
| 839.89M | 798.34M | 822.25M | 729.55M | 714.53M | 793.20M | Total Liabilities |
| 1.38B | 1.40B | 1.36B | 1.40B | 1.40B | 1.46B | Stockholders Equity |
| 413.41M | 437.16M | 525.67M | 487.08M | 636.40M | 611.43M |
| Cash Flow | Free Cash Flow | ||||
| 40.86M | 34.06M | 28.93M | 65.54M | 128.50M | 145.60M | Operating Cash Flow |
| 81.54M | 79.28M | 79.52M | 126.86M | 162.81M | 180.45M | Investing Cash Flow |
| -31.35M | -46.97M | -58.73M | -80.85M | -12.99M | -2.72M | Financing Cash Flow |
| -52.72M | -35.04M | -50.20M | -37.21M | -122.85M | -172.25M |
Matthews International Technical Analysis
Negative
24.60
Price Trends
27.03
Negative
26.31
Negative
25.58
Negative
Market Momentum
-0.90
Negative
44.52
Neutral
42.12
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MATW, the sentiment is Negative. The current price of 24.6 is below the 20-day moving average (MA) of 24.71, below the 50-day MA of 27.03, and below the 200-day MA of 25.58, indicating a bearish trend. The MACD of -0.90 indicates Negative momentum. The RSI at 44.52 is Neutral, neither overbought nor oversold. The STOCH value of 42.12 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MATW.
Matthews International Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $2.64B | 23.75 | 21.32% | ― | 8.80% | 97.52% | |
75 Outperform | $73.13B | 36.08 | 18.61% | 0.95% | 7.13% | 18.68% | |
75 Outperform | $11.66B | 22.88 | 32.22% | 1.48% | 2.11% | 0.05% | |
70 Outperform | $1.08B | 75.95 | 25.49% | ― | 17.10% | 83.72% | |
62 Neutral | $8.11B | 13.34 | 1.17% | 3.02% | 4.16% | -15.14% | |
53 Neutral | $1.24B | 31.68 | 4.54% | 0.97% | -2.20% | -28.50% | |
47 Neutral | $761.83M | ― | -13.19% | 3.98% | -4.53% | -252.80% |
* Industrials Sector Average
Performance Comparison
MATW
Matthews International
24.60
-4.12
-14.35%
HURN
Huron Consulting
149.28
49.93
50.26%
RSG
Republic Services
234.18
51.99
28.54%
SCI
Service International
80.86
6.90
9.33%
HLIO
Helios Technologies
37.10
-6.54
-14.99%
PRSU
Pursuit Attractions and Hospitality
38.50
2.10
5.77%
Matthews International Earnings Call Summary
Earnings Call Date: Feb 6, 2025 | % Change Since: -15.72% | Next Earnings Date: Apr 24, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture with significant challenges in sales declines and increased debt but was balanced by a major arbitration victory, promising cost reduction initiatives, and positive outlooks in specific segments like SGK Brand Solutions and warehouse automation.Highlights
Arbitration Victory
The company won an arbitration ruling against Tesla, confirming its rights to market and sell dry battery electrode technology, which is expected to boost its energy business.
Cost Reduction Initiatives
The company is on track to achieve or potentially exceed $50 million in annual savings through cost reduction programs across business units.
SGK Brand Solutions Segment Growth
The SGK Brand Solutions segment reported a slight increase in sales to $130.8 million, driven by improved pricing and higher sales in key markets.
Positive Outlook for Warehouse Automation
The warehouse automation business is seeing increased interest and order intake, indicating a potential recovery and strong performance in the coming quarters.
Lowlights
Decline in Industrial Technology Sales
Sales for the industrial technology segment decreased significantly to $80.5 million from $111.4 million, primarily due to a slowdown in the Tesla project and litigation impacts.
Memorialization Segment Challenges
Sales in the memorialization segment fell to $190.5 million from $208.1 million, affected by lower granite memorial sales, a decline in casket volumes, and the disposal of unprofitable European operations.
Increased Debt Levels
Outstanding debt rose to $809 million from $776 million, with a net debt leverage ratio of 3.88, although improvements are expected with future cash flow.
Operational Cash Flow Challenges
Cash flow utilized in operating activities was negative $25 million, reflecting seasonally lower earnings and payments related to cost reduction actions.
Company Guidance
During the Matthews International First Quarter Fiscal 2025 Financial Results Conference Call, the company provided several key financial metrics and guidance. For the fiscal 2025 first quarter, sales for the memorialization segment were $190.5 million, down from $208.1 million the previous year, largely due to lower Granite Memorial sales and a decline in casket unit volumes. Adjusted EBITDA for this segment remained stable at $36.6 million, despite higher U.S. healthcare costs. The industrial technology segment saw a significant decrease in sales to $80.5 million from $111.4 million, impacted by a slowdown in the Tesla project and litigation effects, with adjusted EBITDA falling to $1.8 million from $9.6 million. The SGK Brand Solutions segment reported sales of $130.8 million, a slight increase from the prior year, but adjusted EBITDA decreased to $12.3 million due to higher wages and benefits. The company emphasized ongoing cost reduction efforts, with anticipated annual savings of up to $50 million, and a focus on debt reduction. Their net debt was $776 million at the end of the quarter, with a leverage ratio of 3.88, expected to improve with the $250 million proceeds from the SGK transaction expected mid-2025.Matthews International Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
Matthews International Announces Governance Changes and Board Transition
Positive
Feb 19, 2025
On February 14, 2025, Matthews International Corporation announced a series of governance changes, including the planned transition of the Board Chair role by 2026. Current Board Chair Alvaro Garcia-Tunon will retire, and an independent chair will be appointed. Gregory S. Babe resigned from the board on February 13, 2025, and Thomas Gebhardt was appointed to fill his vacancy. The company aims to appoint a new independent director with expertise in battery and EV technology solutions, highlighting its focus on enhancing shareholder value. Matthews also plans to declassify its Board and amend its Articles of Incorporation to improve governance transparency. These changes are part of Matthews’ broader strategy to drive long-term shareholder value, including the sale of SGK Brand Solutions and marketing its Dry Battery Electrode technology to new customers.
Legal ProceedingsBusiness Operations and StrategyFinancial DisclosuresRegulatory Filings and Compliance
Matthews International Reports Q1 2025 Financial Results
Neutral
Feb 7, 2025
Matthews International announced its fiscal 2025 first-quarter financial results on February 6, 2025, highlighting steady performances in its Memorialization and SGK Brand Solutions segments, despite challenges in its Industrial Technologies division due to Tesla litigation. The company affirmed its outlook for fiscal 2025, noting a positive arbitration ruling on its Dry Battery Electrode technology, and initiated regulatory filings to complete the SGK transaction by mid-2025. The company’s results showed a decrease in sales and net income compared to the previous year, with a focus on cost reduction and debt management initiatives.
Dividends
Matthews International Announces Quarterly Dividend for 2025
Positive
Jan 30, 2025
On January 29, 2025, Matthews International Corporation announced a quarterly dividend of $0.25 per share on its common stock, payable on February 24, 2025, to stockholders recorded by February 10, 2025. This announcement underscores the company’s ongoing commitment to returning value to its shareholders, potentially enhancing its financial standing and shareholder relations.
Executive/Board ChangesShareholder MeetingsBusiness Operations and StrategyRegulatory Filings and Compliance
Matthews International Announces Board Changes and Strategic Plans
Neutral
Jan 27, 2025
On January 24, 2025, Gregory S. Babe announced he would not seek re-election to Matthews International Corporation’s Board of Directors during the 2026 Annual Meeting of Shareholders, with no disagreements cited with the company’s operations or policies. Matthews filed an investor presentation with the SEC highlighting its strategic positioning for long-term success and urging shareholders to support its director nominees. The company emphasizes its strategic investments in new markets and the Industrial Technologies segment, along with a significant cost reduction program and a transaction involving SGK Brand Solutions. The board’s commitment to shareholder value creation and strategic alignment is underscored by its diverse and experienced members.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.