AVIENT CORPORATION (AVNT): what the price requires
At today's price, AVIENT CORPORATION (AVNT) is priced for +14.7% growth. boothcheck doesn't publish a fair value or a price target; it shows what the price assumes, so you can judge whether that bar is too high.
Generated: 2026-07-19 · Source: https://boothcheck.com/report/AVNT
Headline
| Field | Value |
|---|---|
| Ticker | AVNT |
| Company | AVIENT CORPORATION |
| Current price | $35.57/sh |
| Composition | Color, Additives and Inks 62% / Specialty Engineered Materials 38% |
What The Price Requires (Inversion)
The assumption today's price embeds, recovered by inverting the valuation.
| Field | Value |
|---|---|
| Inversion basis | whole-company |
| Operating margin needed | 6.9% |
| Operating margin today | 7.8% |
| Margin compression implied | -0.9pp |
| Implied growth | 14.7% |
| Multiple paid | 20x operating income |
The operating-margin requirement is derived from the framework's value band at year 12, a separately labeled basis from the headline growth/duration solve.
Solve inputs: computed at a 9.1% cost of capital with 4% terminal growth over a 5-year stage; each 1pp of cost of capital moves the implied operating-profit growth ~6.9pp.
How unusual the bet is: within-range
| Reference | Value |
|---|---|
| vs own history | +0.20σ |
| cohort percentile (of 74 peers) | 55 |
| sustained it ~5 years at this level | 51% |
| implied end-window share | 0% |
Valuation X-Ray
The price is justified by relative-multiple and growth-DCF; asset-based/earnings-power land below the price.
How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.
| Family | Median price/FV | Models | Reads |
|---|---|---|---|
| Asset | 2.31x | 5 | expensive |
| Earnings | 3.09x | 5 | expensive |
| Relative | 0.66x | 5 | justifies |
| Growth | 1.13x | 5 | expensive |
Families that justify the price: Relative, Growth Families that call it expensive: Asset, Earnings
The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 7.3%); the inversion above states its own rate.
Per-Model Detail (n=20)
| Model | Family | FV | Price/FV | Applicable | Methodology |
|---|---|---|---|---|---|
| DCF Perpetual Growth | Growth | $16.68 | 2.13x | yes | FCF base $0.2B, growth 1% (input: historical growth), terminal g 1.3%, WACC 7.3%, 5yr projection |
| DCF Exit Multiple | Growth | $31.40 | 1.13x | yes | Exit EV/EBITDA: 8.7x / 10.7x / 12.7x (bear / base = today's held flat / bull), 5yr |
| Relative Valuation | Relative | $22.91 | 1.55x | yes | P/E 14x (static sector reference · 2026-04), scenarios: 11.8x / 14.0x / 16.2x (bear / base = reference held flat / bull), EV/EBITDA 8x |
| Simple DDM | Growth | $43.44 | 0.82x | yes | DPS $1.10, g=6.6% (sustainable: ROE (TTM) × retention; not the terminal-growth assumption), ke=9.3% |
| Two-Stage DDM | Growth | $38.90 | 0.91x | yes | Stage 1: 20% for 5yr, Stage 2: 3.5% perpetual |
| Simple Excess Return | Asset | $18.56 | 1.92x | yes | BV/sh $26.18, ROE (TTM) 6.6%, ke 9.3% |
| Two-Stage Excess Return | Asset | $15.41 | 2.31x | yes | 5yr excess ROE then converge to ke=9.3% |
| Discounted Future Market Cap | Growth | $24.00 | 1.48x | yes | Rev $3.3B, growth 1% (input: historical growth; tapered), Terminal P/S: 0.8x / 1.0x / 1.2x (bear / base = today's held flat / bull, cap 8x) |
| Peter Lynch Fair Value | Relative | $60.20 | 0.59x | yes | EPS $1.72, growth 35% (input: historical EPS growth), PEG=0.59 (Undervalued) |
| Margin Trajectory | Growth | — | — | no | — |
| Earnings Power Value | Earnings | $11.50 | 3.09x | yes | Normalized EBIT (5y avg op income, one-time charges added back) $0.28B × (1−23%) / WACC 7.3% → EPV (no growth) |
| Residual Income | Asset | $14.97 | 2.38x | yes | BV $26.18 + 5yr PV of (ROE (TTM) 6.6% − Kₑ 9.3%) × BV; BV grows 4.3%/yr |
| Graham Number | Asset | $31.83 | 1.12x | yes | √(22.5 × EPS $1.72 × BVPS $26.18) — Graham's conservative floor |
| EV/EBITDA Relative | Relative | $21.46 | 1.66x | yes | EBITDA $0.49B × sector EV/EBITDA 8.0x |
| FCF Yield | Earnings | $3.18 | 11.19x | yes | FCF $205.1M / Kₑ 9.3% — zero-growth perpetuity |
| SBC-Adj FCF Yield | Earnings | $2.15 | 16.54x | yes | SBC-adj FCF $0.20B (FCF $0.21B − SBC $0.01B) capitalized at Kₑ |
| Ben Graham Formula | Earnings | $55.50 | 0.64x | yes | EPS $1.72 × (8.5 + 2×15.0%) × (4.4 / 5.3%) |
| ROIC-Justified P/B | Asset | $6.16 | 5.77x | yes | BV $26.18 × (ROIC 1.7% / WACC 7.3%) |
| P/Sales Sector | Relative | $53.55 | 0.66x | yes | Revenue $3.28B × sector P/S 1.5x |
| PEG Fair Value | Relative | $64.50 | 0.55x | yes | EPS $1.72 × (PEG 1.5 × growth 25.0% (input: historical EPS growth)) → PE 37.5x |
| Earnings Yield | Earnings | $18.59 | 1.91x | yes | EPS $1.72 / required return 9.3% (Rf 4.3% + ERP 5.0%) |
| Funds From Operations Multiple | Relative | — | — | no | — |
| Clinical Phase NPV | Growth | — | — | no | — |
| Merton | Asset | — | — | no | — |
| V5 Mechanical | — | — | — | no | — |
Solvency
| Field | Value |
|---|---|
| Net debt | $1.9b |
| Net debt / NOPAT (after-tax) | 9.60x |
| Net debt / operating income (pre-tax) | 7.41x |
| Share count CAGR (buyback) | -0.1% |
| Burning cash | no |
Interest expense is not separately reported in the latest filings, so interest coverage cannot be computed.
Bullet Takeaways
At $37.69 the price pays about 20x company-wide operating income, which implies roughly 17% operating growth a year for five years. That rate is within what Avient has recently delivered, so the assumption reads as within range rather than heroic, but it leans on the duration holding.
The earnings trajectory is the supporting evidence. Q1 2026 adjusted EPS of $0.83 grew 9% and beat the $0.81 guide, on sales up 3% to $847 million, with EBITDA margins expanding even as organic volume stayed soft. Management reaffirmed full-year adjusted EPS of $2.93 to $3.17 and EBITDA of $555 to $585 million.
The methods split by family. Relative multiples and the growth DCF reach the price; asset and earnings-power floors land well below. The clearest risk is leverage: net debt of roughly $1.9 billion sits at about 6.5x trailing operating income, so the margin story has to keep delivering.
Bull Case
Follow the earnings line, because the direction is the bull case. Q1 2026 adjusted EPS came in at $0.83, up 9% year over year and ahead of the $0.81 guidance, on sales of $847 million that grew 3%. GAAP EPS swung to $0.61 from a negative $0.22 in the prior-year quarter. The gain did not come from volume, which was still soft, it came from margin: EBITDA margins in Color, Additives and Inks improved 40 basis points as pricing and productivity more than offset wage inflation and lower organic sales. That is the signature of a business that has learned to expand profitability without a demand tailwind.
The mix is defensive where it needs to be. Color, Additives and Inks generated $528.1 million of sales and $81.4 million of operating income in the quarter, with continued strength in health care and stable packaging offsetting weak consumer, transportation, and industrial demand. Specialty Engineered Materials added $320.2 million of sales and $47.4 million of operating income. The FY2025 10-K notes that segment operating income excludes unallocated corporate costs and restructuring, so the reported segment margins reflect the underlying product economics rather than one-time noise. A specialty formulator anchored in health care and packaging has a steadier base than a commodity chemical producer.
The forward setup is credible. Management reaffirmed 2026 adjusted EPS of $2.93 to $3.17 and EBITDA of $555 to $585 million, and guided Q2 to $0.89, an 11% increase. The reverse-DCF implies roughly 17% operating growth for five years, a pace Avient has recently delivered, and the inversion notes the near-term rate is within the company's own history. If the productivity engine keeps expanding margins while end-market demand merely stabilizes rather than recovers, the earnings base grows into the multiple without requiring a cyclical upturn the bull case cannot promise.
Bear Case
The price leans on a forward earnings story, and the most fragile assumption inside it is that margin expansion keeps compounding while volume stays flat. At $37.69 (June 27, 2026) the market pays about 20x operating income for roughly 17% annual operating growth over five years. The recent gains have come almost entirely from pricing and productivity, not from organic volume, which fell 3% in Color, Additives and Inks. Productivity savings are finite. Once the easy cost takeouts are banked, the growth has to come from demand, and consumer, transportation, and industrial end markets are still subdued. The FY2025 10-K is explicit that demand for and supply of its products are affected by several factors the company cannot predict or control. If volume does not turn, the EPS path the price assumes runs out of runway.
The balance sheet narrows the margin for error. Net debt is roughly $1.9 billion against trailing operating income near $299 million, a ratio of about 6.5x, and interest expense is not separately broken out in the filings, so coverage is hard to verify. That is meaningful leverage for a cyclical materials business, and it means a demand downturn hits a levered earnings stream. The asset and earnings-power frames already say the equity is expensive: simple and two-stage excess return land near $15 to $19 per share, earnings power value near $9, and the zero-growth FCF-yield mark near $3. ROIC-justified book value comes in near $6 because returns on capital sit around 1.7%, well below the 7.3% WACC.
That is the structural tell. Only the relative multiple and the growth DCF reach the price; every static frame falls far short. The bet is that Avient earns its way out of the gap through years of margin-led EPS growth on flat volume. Management itself flagged uncertainty in the second half when it reaffirmed rather than raised guidance after a Q1 beat. If raw-material costs swing, if the foreign-exchange tailwind that added 5 points to Q1 sales reverses, or if end-market demand stays soft into 2027, the earnings story that justifies the multiple is the first thing to crack, and the levered balance sheet leaves little cushion underneath it.
Valuation
Inverting the $37.69 price gives the anchor. At that level the market pays about 20x company-wide operating income, which under a 9.3% cost of capital and 4% terminal growth implies operating growth of roughly 17% a year for five years. Each one-point change in the cost of capital moves the implied growth by about 7 points, so the read is sensitive to rates, but the central case sits within what Avient has recently delivered. Against history, only about 47% of comparable fast-growers sustained that pace for five years, which is why the priced-in assumption reads as within range rather than demanding. The reverse-DCF range runs from a low near $29 to a base near $33.
The model X-ray splits sharply by family. The relative and growth frames support the price: a DCF exit-multiple near $33, a blended relative P/E mark near $25, and dividend-discount marks in the high $30s to low $40s. The asset and earnings-power frames sit far below: simple and two-stage excess return near $15 to $19, earnings power value near $9, residual income near $15, and the zero-growth FCF-yield mark near $3. The Peter Lynch and Ben Graham growth-adjusted marks reach into the $55 to $60 range on a 35% historical EPS growth input, the optimistic tail.
The spread is the information. The price is not a verdict on whether Avient is a good formulator. It is a measure of how much margin-led growth the market has booked: roughly 17% operating growth for five years on a balance sheet carrying about 6.5x net leverage.
Catalysts
The near-term driver is the 2026 earnings cadence against reaffirmed guidance. Q1 2026 adjusted EPS of $0.83 beat the $0.81 guide and grew 9%, and management guided Q2 to $0.89, an 11% increase, while holding full-year adjusted EPS at $2.93 to $3.17 and EBITDA at $555 to $585 million. Whether the productivity-led margin expansion continues into a still-soft demand backdrop is the swing factor for that guide.
End-market demand is the structural catalyst. Color, Additives and Inks saw continued strength in health care and stable packaging offset by weak consumer, transportation, and industrial demand, with organic sales down 3%. A recovery in those cyclical end markets would shift the growth source from cost productivity to volume, a more durable base. Conversely, prolonged softness keeps the EPS story dependent on finite productivity savings.
Watch the foreign-exchange contribution, which added about 5 points to Q1 sales and can reverse, raw-material cost trends, and any update to the second-half outlook management flagged as uncertain. Leverage progress matters too, given net debt near $1.9 billion.
Sources: StockTitan and Investing.com (AVNT Q1 2026 results, $0.83 adjusted EPS beat, reaffirmed 2026 guidance), PlasticsToday and Avient investor slides (segment sales and operating income, margin expansion, Q2 $0.89 guide), AOL/Avient earnings call transcript (end-market demand commentary).
Peer Cohorts (Per Segment, With Filing Citations)
Color, Additives and Inks (reported)
- CBT (Cabot Corporation)
- FY2025 10-K: …conductive additives and other materials for battery applications, and inkjet dispersions for high-speed industrial printing applications, including packaging and graphic arts. The recent investments we have made for growth in this segment, including with respect to these specific areas of focus, are described below…
- FY2025 10-K: …sale of specialty carbons and products for battery materials applications with a mix of global and regional companies. In recent years, a number of these companies that operate regionally have increased the export of products outside their region of manufacture. For fumed alumina, we compete primarily with one…
- EMN (EASTMAN CHEMICAL CO)
- FY2025 10-K: …gut health solutions preservation and hygiene Coatings Additives Polymers cellulosics polyesters polyolefins Additives and Solvents Texanol ™ Optifilm ™ ketones esters EastaPure ™ electronic chemicals specialty coalescents specialty solvents paint additives specialty polymers BASF SE Dow Inc. OXEA Celanese…
- FY2025 10-K: …us-gaap:ProductConcentrationRiskMember us-gaap:SalesRevenueSegmentMember emn:AdditivesAndFunctionalProductsMember 2023-01-01 2023-12-31 0000915389 srt:NorthAmericaMember us-gaap:GeographicConcentrationRiskMember us-gaap:SalesRevenueSegmentMember emn:AdditivesAndFunctionalProductsMember 2025-01-01 2025-12-31…
- CE (CELANESE CORPORATION)
- FY2025 10-K: …value-in-use and is generally independent of changes in the cost of raw materials. Therefore, in general, margins may expand or contract in response to changes in raw material costs. See Note 22 - Revenue Recognition in the accompanying consolidated financial statements for further information. Acetyl Chain Products…
- FY2025 10-K: …customers under multi-year contracts and on the basis of long-standing relationships. Solvents and derivatives customers are primarily engaged in the production of paints, coatings and adhesives. We manufacture formaldehyde for our own use as well as for sale to a few regional customers. Emulsion, RDP and EVA…
- OLN (Olin Corporation)
- FY2025 10-K: …Foreign Jurisdictions that Prevent Inspections 99 Part III 100 Item 10. Directors, Executive Officers and Corporate Governance 100 Item 11. Executive Compensation 100 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 100 Item 13. Certain Relationships and Related…
- FY2025 10-K: …of Contents 101.INS Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the XBRL document) 101.SCH XBRL Taxonomy Extension Schema Document 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF Inline XBRL…
- HUN (Huntsman Corporation)
- FY2025 10-K: …economics. Jan Buberl , age 50, is Division President, Performance Products. Mr. Buberl was appointed to this position in August 2024. Prior to that time, Mr. Buberl served as Vice President-Americas for our Polyurethanes segment and as a director of our Chinese PO/MTBE joint venture with Sinopec since January 2019.…
- FY2025 10-K: …representative customers, raw materials and representative competitors of each of our business segments: Product lines End markets / applications Representative customers Raw materials Representative competitors Polyurethanes MDI Polyurethane chemicals are used to produce rigid and flexible foams, as well as…
- CC (Chemours Co)
- FY2025 10-K: …hemisphere for residential, commercial, and automotive air conditioning in the spring, which peaks in the summer months, and then declines in the fall and winter. Mobile air conditioning demand is slightly higher in the first half of the year due to the timing of automotive production shutdowns in the second half of…
- FY2025 10-K: …de-bottlenecking processes. If needed, unlocking additional capacity is in line with our stated intention to grow with our customers' needs over the long-term. Competition in the TiO 2 pigment market is based primarily on product performance (both product design and quality consistency), supply capability, technical…
- IOSP (INNOSPEC INC.)
- FY2025 10-K: …fuel efficiency, boost engine performance and reduce harmful emissions. Our Oilfield Services business supplies chemicals for drilling, completion, production and drag reducing agents ("DRA") which make oil and gas exploration and production more cost-efficient and environmentally friendly. Segment Information The…
- FY2025 10-K: …with developing customer needs. In addition, the business has developed further formulations in emollients, silicones and surfactants for the personal care, home care, agrochemical, construction, mining and other industrial markets. Fuel Specialties has continued to innovate, focused on bringing new technologies to…
- NEU (NEWMARKET CORPORATION)
- FY2025 10-K: …is characterized by the need to provide customers with cost-effective, technologically-capable products that meet or exceed industry specifications. The need to continually increase technology performance and lower cost through formulation technology and cost improvement programs is vital for success in this…
- FY2025 10-K: …Commonwealth of Virginia in 2004. Our principal executive offices are located at 330 South Fourth Street, Richmond, Virginia, and our telephone number is (804) 788-5000. 3 Table of Contents Business Segments For the periods presented in this Annual Report on Form 10-K, our business was composed of two segments,…
Specialty Engineered Materials (reported)
- CE (CELANESE CORPORATION)
- FY2025 10-K: Asia and consist of 51 global production facilities and an additional 20 strategic affiliate production facilities. As of December 31, 2025, we employed 11,434 people worldwide. Business Segment Overview We operate principally through two business segments: Engineered Materials and the Acetyl Chain. See Business…
- FY2025 10-K: …Engineered Materials business segment. The Company manages its Acetyl Chain business segment by leveraging its ability to sell chemicals externally to end-use markets or downstream to its acetate tow, intermediate chemistry, emulsion polymers, redispersible powders and ethylene vinyl acetate polymers businesses.…
- EMN (EASTMAN CHEMICAL CO)
- FY2025 10-K: Eastman's strategy is to target industries and markets where the Company can leverage its application development expertise to develop product offerings to provide differentiated value that addresses current and future customer and market needs. The Company's strategic marketing approach and capabilities leverage the…
- FY2025 10-K: …(Fo Gang) Specialty Resins Limited Chang Chun Petrochemical Co., Ltd. polyvinyl alcohol butyraldehyde 2-ethyl hexanol ethanol triethylene glycol vinyl acetate monomer transportation (automotive safety glass, automotive acoustic glass, and HUD) building and construction (PVB for architectural interlayers) Performance…
- HUN (Huntsman Corporation)
- FY2025 10-K: …of suppliers. We consume certain amines produced by our Performance Products segment and isocyanates produced by our Polyurethanes segment, which we use to formulate our Advanced Materials products. For additional information about our risks of raw material supply chain disruptions, see "Part I. Item 1A. Risk…
- FY2025 10-K: …aluminum panels and other steel materials to lighten structures in aerospace, automotive and other transportation. Our Advanced Materials segment is characterized by the breadth of our product offering, our expertise in complex chemistry, our long-standing relationships with our customers, our ability to develop and…
- CC (Chemours Co)
- FY2025 10-K: Specialized Solutions segment, we are a leading, global provider of refrigerants, thermal management solutions, propellants, foam blowing agents, and specialty solvents. Our Thermal & Specialized Solutions segment has held a leading position in the refrigerants market since the commercial introduction of Freon TM in…
- FY2025 10-K: …by product line and markets served. Our Advanced Performance Materials segment maintains a fleet of railcars, tank trucks, containers, and totes to deliver our products and support our supply chain needs. For the portion of the fleet that is leased, the related lease terms are usually staggered, which provides us…
- ROG (Rogers Corporation)
- FY2025 10-K: …the loss of any one of our larger customers would require a period of adjustment, during which the results of operations could be materially adversely impacted, we believe that such events could be successfully mitigated over a period of time due to the diversity of our customer base. We employ a technical sales and…
- FY2025 10-K: …Our competitors include commodity materials suppliers, which offer product substitutions based mostly on price, and suppliers of alternate solutions, which offer product substitutions or eliminations based mostly on disruptive technology. Certain of these competitors have greater financial and other resources than we…
Methodology Note
- Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
- Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
- Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
- Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.
Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.