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Origin Materials (ORGN)
NASDAQ:ORGN
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Origin Materials
(NASDAQ:ORGN)
49Neutral
Positive Factors
Contracts and Expansion
ORGN secures $100mn contract for PET caps, expanding its production capabilities in the US and Europe.
Financial Performance
Origin's PET-based caps and closures have potential, with plans to produce millions of caps and generate positive EBITDA.
Negative Factors
Leadership Changes
The departure of co-CEO Rich Riley, who led the CMF commercialization effort, adds to the uncertainty.
Technology Uncertainty
The future of Origin's cellulose-based technology is uncertain, leading to a lower stock rating.
Origin Materials (ORGN) vs. S&P 500 (SPY)
Market Cap
$118.61M
Dividend YieldN/A
Average Volume (3M)1.63M
Price to Earnings (P/E)―
Beta (1Y)1.81
Revenue Growth123.12%
EPS Growth-258.22%
CountryUS
Employees162
SectorBasic Materials
Sector Strength63
IndustryChemicals
Share Statistics
EPS (TTM)-0.56
Shares Outstanding146,250,170
10 Day Avg. Volume1,146,236
30 Day Avg. Volume1,626,900
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)3.38
Price to Cash Flow (P/CF)-2.20
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
$1.50Price Target Upside87.50% Upside
Rating ConsensusModerate Sell
Number of Analyst Covering1
Origin Materials Business Overview & Revenue Model
Company DescriptionOrigin Materials (ORGN) is a leading company in the sustainable materials sector, focused on transforming the chemical and manufacturing industries. The company specializes in producing bio-based chemical intermediates from non-food biomass, which are used to replace traditional petrochemical ingredients in a wide range of products. Origin Materials' core mission is to enable the world's transition to sustainable materials by innovating and providing cost-effective solutions that reduce carbon footprints and reliance on fossil fuels.
How the Company Makes MoneyOrigin Materials generates revenue through the production and sale of sustainable chemical intermediates derived from non-food biomass. The company partners with manufacturers across various sectors, including plastics, textiles, automotive, and packaging, to supply bio-based materials that serve as alternatives to petrochemicals. Key revenue streams include long-term supply agreements with major corporations seeking to incorporate sustainable materials into their products. Additionally, Origin Materials may engage in joint ventures and strategic partnerships to expand its market reach and enhance its technological capabilities, further contributing to its earnings.
Origin Materials Financial Statement Overview
Summary
Origin Materials is experiencing revenue growth, but faces significant profitability and cash flow challenges. Despite a strong equity position, the company shows declining overall financial health with negative margins and cash flow issues.Income Statement
Origin Materials has shown a positive revenue growth from 2023 to 2024, with total revenue increasing from $28.8M to $35.1M. However, the company is struggling with negative profitability metrics, including a gross profit margin of -2.33% and a net profit margin of -229.57% in TTM. The EBIT and EBITDA margins are also negative, indicating operational challenges.45
Neutral
Balance Sheet
Origin Materials' balance sheet shows a strong equity position with a debt-to-equity ratio of 0.03, indicating low leverage. However, total assets and stockholders' equity have decreased over the period, which could indicate potential risks. The company maintains a high equity ratio of 89.81%, suggesting stability in its asset base.50
Neutral
Cash Flow
The cash flow statement highlights significant free cash flow challenges, with a negative free cash flow growth rate from 2023 to 2024 and a negative operating cash flow to net income ratio. The company is spending heavily on capital expenditures, impacting cash reserves.40
Negative
| Breakdown | |||||
| TTM | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 | Dec 2019 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 35.12M | 28.80M | 0.00 | 0.00 | 0.00 | 0.00 | Gross Profit |
| -818.00K | 5.21M | -1.29M | -824.00K | -479.00K | 0.00 | EBIT |
| -84.84M | -54.88M | 57.02M | 50.78M | -10.38M | -11.06M | EBITDA |
| -70.24M | 26.82M | 79.86M | 45.75M | -10.70M | -10.41M | Net Income Common Stockholders |
| -80.61M | 23.80M | 78.57M | -37.05M | -31.45M | -479.41K |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 1.31M | 158.26M | 323.32M | 444.10M | 1.31M | 3.05M | Total Assets |
| 47.43M | 461.83M | 493.70M | 510.42M | 47.43M | 47.80M | Total Debt |
| 9.33M | 9.76M | 8.71M | 6.96M | 9.33M | 10.97M | Net Debt |
| 8.02M | -65.74M | -99.14M | -39.68M | 8.02M | 7.92M | Total Liabilities |
| 47.31M | 39.33M | 116.80M | 206.91M | 47.31M | 19.06M | Stockholders Equity |
| 123.00K | 422.51M | 376.90M | 303.51M | 123.00K | 28.73M |
| Cash Flow | Free Cash Flow | ||||
| -84.14M | -170.46M | -110.03M | -34.51M | -7.51M | -14.48M | Operating Cash Flow |
| -59.03M | -60.35M | -26.09M | -22.04M | -5.46M | -7.33M | Investing Cash Flow |
| 41.24M | 26.23M | 88.85M | -411.64M | -2.05M | -7.15M | Financing Cash Flow |
| 3.55M | 146.00K | 1.25M | 478.95M | 5.83M | 4.42M |
Origin Materials Technical Analysis
Negative
0.80
Price Trends
0.98
Negative
1.11
Negative
1.14
Negative
Market Momentum
-0.04
Positive
39.16
Neutral
25.37
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ORGN, the sentiment is Negative. The current price of 0.8 is below the 20-day moving average (MA) of 0.86, below the 50-day MA of 0.98, and below the 200-day MA of 1.14, indicating a bearish trend. The MACD of -0.04 indicates Positive momentum. The RSI at 39.16 is Neutral, neither overbought nor oversold. The STOCH value of 25.37 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ORGN.
Origin Materials Risk Analysis
Origin Materials disclosed 52 risk factors in its most recent earnings report. Origin Materials reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Origin Materials Peers Comparison
Overall Rating
UnderperformOutperform
Sector (46)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
64 Neutral | $289.68M | ― | -14.78% | ― | 16.59% | -7.74% | |
58 Neutral | $320.45M | 222.17 | 0.51% | ― | -10.30% | -93.51% | |
49 Neutral | $118.61M | ― | -20.59% | ― | 123.12% | -258.22% | |
46 Neutral | $2.64B | -3.89 | -29.36% | 3.33% | 2.89% | -29.66% | |
32 Underperform | $3.52M | ― | -43.11% | ― | -26.70% | 27.53% |
* Basic Materials Sector Average
Performance Comparison
ORGN
Origin Materials
0.80
0.26
48.15%
GEVO
Gevo
1.21
0.49
68.06%
BIOX
Bioceres Crop Solutions
5.22
-7.71
-59.63%
DNMR
Danimer Scientific
1.24
-65.16
-98.13%
Origin Materials Earnings Call Summary
Earnings Call Date: Nov 14, 2024 | % Change Since: -36.00% | Next Earnings Date: Mar 13, 2025
Earnings Call Sentiment Positive
The earnings call presented a positive outlook with significant progress in their caps and closures business and strong customer demand. However, there are operational adjustments such as reduced staffing at the biomass plant and uncertainty about the Origin 2 location. The focus remains on achieving profitability by 2026.Highlights
Successful Factory Acceptance Test
Origin's CapFormer System achieved over 98% efficiency, producing several million fully functional PET caps, marking a milestone in their journey to profitability.
Strong Customer Demand and MOU
Customer momentum remains strong with a $100 million Memorandum of Understanding for PET caps and multiple potential customers engaged in testing and qualification.
Positive EBITDA Projection
Origin expects to be EBITDA positive on a run rate basis in the first half of 2026, with initial caps and closures revenue generation starting in Q1 2025.
Expansion Plan
The company plans to bring 8 or more CapFormer System into production by the end of 2025, potentially producing between 8 billion and 12 billion caps per year.
Financial Stability
Origin ended the quarter with $113 million in cash, cash equivalents, and marketable securities, aligning with cash burn guidance.
Lowlights
Reduced Operations at Biomass Conversion Plant
Origin is operating its biomass conversion plant in Sarnia, Ontario on demand with somewhat reduced staffing to conserve cash.
Uncertainty Around Origin 2 Location
The company is unsure about the specific location for Origin 2, considering an Asian brownfield facility, but has not finalized any plans.
Company Guidance
In the third quarter of 2024, Origin Materials provided guidance on its caps and closures business, highlighting significant milestones and future projections. The company successfully completed the factory acceptance test of its initial CapFormer System, achieving over 98% efficiency and producing several million PET caps. Looking ahead, Origin anticipates being EBITDA positive on a run rate basis in the first half of 2026. By the end of 2025, they plan to have eight or more CapFormer Systems operational, potentially producing between 8 billion and 12 billion caps annually. This production capacity is expected to support their announced $100 million MOU for PET caps. With commercialization on track, initial revenue from caps and closures is projected in the first quarter of 2025, and significant gross profit generation is anticipated to begin in 2025, setting the stage for a healthy growth trajectory.Origin Materials Corporate Events
Executive/Board Changes
Origin Materials Announces Leadership Changes and Appointments
Neutral
Dec 17, 2024
Origin Materials announced the resignation of Rich Riley as Co-CEO and board member, effective December 31, 2024. John Bissell will continue as the sole CEO, while Rich Riley will provide advisory services until January 2026. Additionally, Matt Plavan, the current CFO, has been appointed as the Chief Operating Officer while retaining his CFO responsibilities.
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.