Axalta Coating Systems (AXTA) Stock Analysis & Winston Score

Axalta Coating Systems makes paints and coatings — the protective and decorative layers applied to cars, trucks, and buildings. Its main products include refinish coatings used by auto body shops to repaint damaged vehicles, as well as coatings sold directly to car manufacturers like Ford and General Motors. The company is one of the largest automotive coatings suppliers in the world.

Axalta earns money by selling its coating products to body shops, vehicle manufacturers, and industrial customers across more than 130 countries. The refinish business is a reliable revenue source because cars get into accidents regardless of the economy, giving the company some stability. Its main competitive advantage is its large distribution network and long-term relationships with body shops that use its proprietary color-matching technology. The key growth driver is expansion in emerging markets like China and India, where rising car ownership is increasing demand for both new vehicle coatings and repair services.

Winston Score History

Politician Trades

21 trades / 12mo

10 Congressional buys and 11 sells on AXTA in the last 12 months.

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Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

-0.6% YoY

YoY Growth Rate

Revenue declining

EPS Growth

-6.7% YoY

YoY Growth Rate

Earnings declining

Insider Activity

0.6%ownership

→ Flat

Insiders holding steady — not selling despite ability to

Cash Position

Cash flow positive

$608M cash & investments

Quarterly Free Cash Flow

→ Burn rate stable

Company generates more cash than it spends — no dilution risk from fundraising

Revenue declining

Axalta Coating Systems's revenue is actually shrinking. In a growth stock, that removes the core investment thesis. The low Winston Score here may be warranted — unless there's a turnaround story.

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

Every number that matters to educated investors.

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Quality

Gross Margin

31.1%

Modest — 31.1% gross margin

Operating Margin

11.6%

Modest — 11.6% operating margin

ROCE

2.6%

Weak — 2.6% return on capital

ROIC between 0% and 5%. They earn a few cents back per dollar invested in the business.

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Growth

Sales YoY

-2.6%

Shrinking sales (-2.6% YoY)

EPS YoY

-16.6%

Earnings shrinking (-16.6% YoY)

Earnings per share down more than 10%. Either a bad year, or a real decline.

EPS Consistency

2/8 quarters

Earnings rarely grow — volatile business

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Cash Flow

Cash Conversion

187%

Turns 187% of profit into real cash

FCF Margin

9.6%

Modest free cash flow (9.6%)

FCF margin between 0% and 10%. Some cash from sales, but not a lot.

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Stability

Debt / Equity

1.30

Elevated debt (1.30)

Interest Cover

3.94x

Tight — interest eats into profit (3.9x)

Interest coverage between 3 and 8. Profits cover interest several times over.

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Valuation

P/E Ratio (TTM)

18.8x

no trend

Fair value — P/E 18.8

P/E in the normal range. Price is roughly $15 for every $1 of yearly profit.

P/E vs Forward

+6.5

GROWING

Earnings expected to grow meaningfully — cheaper on forward P/E (18.8 → 12.3)

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Dividends

Not applicable for this business.

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