Cabot Corporation Common Stock (CBT)

FairStock Score: 57/100 — STEADY

Key Financials

Strengths

• Generates $292 million in annual free cash flow (7.4% yield on market cap)
• Strong Piotroski F-Score of 8/9 indicating robust financial health across profitability, leverage, and efficiency metrics
• High return on equity of 21.8% demonstrating efficient capital deployment
• Attractive 2.4% dividend yield providing steady income returns

Concerns

• Revenue declining at 11.1% year-over-year signals potential demand weakness or market share loss

AI Analysis

Cabot Corporation Common Stock is a small-cap basic materials company valued at $4.0 billion. Revenue stands at $3.6 billion. From a quality standpoint, Cabot shows near-perfect Piotroski F-Score of 8/9 indicating exceptional financial health and Altman Z-Score of 2.4 in the grey zone. On valuation, the stock is attractively valued at 13.3x earnings, with trades above its Graham Number with a negative 22% margin. Growth dynamics show revenue growing at -11.1% and profit growth of -21.5%. The 2.4% dividend yield adds an income component for patient holders. Our composite FairStock Score of 57/100 reflects mixed fundamentals overall. This combination of reasonable valuation, solid returns, and conservative leverage makes it worth a closer look for value-oriented portfolios.

Bull Case

The market underappreciates Cabot's consistent 22% ROE at just 13x earnings—a re-rating toward sector peers could unlock 30-50% upside. With $292 million in annual free cash flow (7.4% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

Macro headwinds or sector-specific disruption could pressure margins, particularly if competitive intensity increases in the basic materials space. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer