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Strengths
- Earnings Consistency: Beat consensus EPS for two consecutive quarters; 10% adjusted growth.
- Dividend Growth: 44 consecutive years of increases; 2.8% current yield.
- Pricing Resilience: Successfully maintained 24%+ margins despite flat volume growth.
Weaknesses
- Flat Volumes: Core volume growth remains stagnant; growth currently depends on pass-throughs and pricing.
- Execution Risk: Heavy reliance on the $8.5 billion NEOM project and other first-of-kind energy transition assets.
- Negative TTM GAAP EPS: Lingering impact of $3.7 billion in 2025 asset impairment charges.
Opportunities
- Asset Sell-Down: Advanced negotiations with Yara could significantly de-risk the balance sheet.
- NASA/Defense Contracts: Over $140 million in long-term supply contracts provides non-cyclical revenue.
- On-Site Expansion: New asset start-ups in the second half of 2026 are expected to drive volume-based earnings growth.
Threats
- Tariff Inflation: 25% duties on specialized steel could inflate the cost of the $4B CAPEX program.
- Subsidy Shifts: Potential changes to U.S. 45V hydrogen tax credits could impact project IRRs.
- Geopolitical Instability: High asset concentration in Saudi Arabia and Asia presents regional macro risks.
