Please register and get access to full articles.
Welcome to our blog – a place to discuss and exchange thoughts and ideas about iX-7 Asset Management SA, the stock markets and all matters relating to wealth management.
Introduction: Croda is a specialty chemical company, with a focus on consumer care. It specializes in deriving its products from naturally occurring oil and fats, and operates in niche market segments, where innovation is the key factor for success. The company was founded in 1925 and ever since then has driven organic growth in developing its new businesses. Management focuses on best practice and a high quality strategy ahead of volume. Because Croda excels mostly in niche products and maintains key industrial procedures, it maintains significant pricing power. Defending this pricing power is part of the company’s management objectives. The demand for Croda’s products is strongly exposed to consumer megatrends (e.g. in personal care, healthcare, nutrition and anti-ageing), as well as trends in performance technologies, through their lubricants, coatings, homecare and oil and water separation products (which are of key importance in the oil recovery area). It is estimated that the company will return about GBP 250 million to investors over the next few years, either by means of special dividends or share buy backs. Alternatively, it could proceed with a further acquisition to drive emerging market business exposure. Strengths and weaknesses analysis / Fundamental analysis: Strengths:
Weaknesses:
Knowledge is power.