FMC CORPORATION (FMC): what the price requires
The current priced-in claim for FMC CORPORATION (FMC) is temporarily suppressed because the live engine record is unavailable. The dated report remains a snapshot, not a current market read.
Generated: 2026-07-14 · Exported: 2026-07-16 · Source: https://boothcheck.com/report/FMC
Headline
| Field | Value |
|---|---|
| Ticker | FMC |
| Company | FMC CORPORATION |
| Current price | $10.93/sh |
| Composition | Insecticides 45% / Herbicides 36% / Fungicides 10% / Plant Health 6% / Other 3% |
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 | 7.7% |
| Operating margin (mid-cycle) | 12.6% |
| Margin compression implied | -4.9pp |
| Trailing margin (depressed year) | -51.5% |
| Multiple paid | 14x mid-cycle 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.
The price sits below what even a 5%/yr operating-profit decline would warrant; the inversion reports a bound, not a solved growth path.
Solve inputs: computed at a 7% cost of capital with 4% terminal growth over a 5-year stage (computed at the 7% minimum rate; the CAPM rate 5.1% sits below it).
Reconcile: at the x-ray's 9.3% required return this reads ~6.3%/yr; the models below use their own rates.
How unusual the bet is: within-range (limited comparison data)
| Reference | Value |
|---|---|
| vs own history | -0.06σ |
| implied end-window share | 0% |
Valuation X-Ray
The price is supported by asset-based and earnings-power and relative-multiple value, while growth-DCF lands below the price. A value/asset-supported name, not a pure growth bet.
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 | 0.79x | 2 | justifies |
| Earnings | 0.20x | 1 | justifies |
| Relative | 0.27x | 2 | justifies |
| Growth | 2.51x | 1 | expensive |
Families that justify the price: Asset, Earnings, Relative Families that call it expensive: Growth
The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 2.7%); the inversion above states its own rate.
Per-Model Detail (n=6)
| Model | Family | FV | Price/FV | Applicable | Methodology |
|---|---|---|---|---|---|
| DCF Perpetual Growth | Growth | $0.00 | — | no | Negative/zero FCF — equity value floored at $0 |
| DCF Exit Multiple | Growth | $0.00 | — | no | Negative/zero FCF or EBITDA — equity value floored at $0 |
| Relative Valuation | Relative | $41.12 | 0.27x | yes | P/S fallback (negative EPS): Sector P/S 1.5x × TTM revenue — excluded from consensus |
| Simple DDM | Growth | $-0.59 | — | no | DPS $2.33, g=-137.5% (sustainable: ROE (TTM) × retention; not the terminal-growth assumption), ke=9.3% |
| Two-Stage DDM | Growth | $-28.72 | — | no | Stage 1: -200% for 5yr, Stage 2: 3.5% perpetual |
| Simple Excess Return | Asset | $14.54 | 0.75x | yes | Reference only (book value floor): BV/sh $14.54, ROE negative |
| Two-Stage Excess Return | Asset | $13.09 | 0.83x | yes | Reference only (book value with convergence): BV/sh $14.54, ROE converges to ke |
| Discounted Future Market Cap | Growth | $4.36 | 2.51x | yes | Rev $3.4B, growth -15% (input: historical growth; tapered), Terminal P/S: 0.3x / 0.4x / 0.5x (bear / base = today's held flat / bull, cap 8x) |
| Peter Lynch Fair Value | Relative | $0.00 | — | no | Negative/zero EPS — earnings-based value floored at $0 |
| Margin Trajectory | Growth | — | — | no | — |
| Earnings Power Value | Earnings | $55.44 | 0.20x | yes | Normalized EBIT (5y avg op income, one-time charges added back) $0.40B × (1−21%) / WACC 2.7% → EPV (no growth) |
| Residual Income | Asset | — | — | no | — |
| Graham Number | Asset | — | — | no | — |
| EV/EBITDA Relative | Relative | — | — | no | — |
| FCF Yield | Earnings | — | — | no | — |
| SBC-Adj FCF Yield | Earnings | — | — | no | — |
| Ben Graham Formula | Earnings | — | — | no | — |
| ROIC-Justified P/B | Asset | — | — | no | — |
| P/Sales Sector | Relative | $41.12 | 0.27x | yes | Revenue $3.43B × sector P/S 1.5x |
| PEG Fair Value | Relative | — | — | no | — |
| Earnings Yield | Earnings | — | — | no | — |
| Funds From Operations Multiple | Relative | — | — | no | — |
| Clinical Phase NPV | Growth | — | — | no | — |
| Merton | Asset | — | — | no | — |
| V5 Mechanical | — | — | — | no | — |
Solvency
| Field | Value |
|---|---|
| Net debt | $4.7b |
| Net debt / NOPAT (after-tax) | 13.87x |
| Net debt / operating income (pre-tax) | 10.96x |
| Interest coverage | 1.8x |
| Share count CAGR (buyback) | -0.3% |
| Burning cash | no |
Leverage and coverage are computed on normalized mid-cycle operating income (mid-cycle margin 12.6%); the trailing year was depressed.
Bullet Takeaways
Capital allocation tells the FMC story right now. The company cut its dividend to 8 cents a quarter and is targeting about $1.0 billion of debt paydown in 2026 through asset sales and licensing, a clear shift from rewarding shareholders to repairing a balance sheet that carries dangerous leverage.
The price near $11.54 sits below the company's book value of about $14.54 a share and, read on through-the-cycle margins, below what even a steady decline in operating profit would warrant. Trailing earnings are deeply negative because the business is in a destocking trough compounded by a patent cliff.
The central fact is moat erosion. Rynaxypyr, FMC's diamide insecticide that historically drove 30% to 40% of revenue, has lost its core patent protection and faces generics. The bet is that a new-active-ingredient pipeline and deleveraging carry the company through; the risk is that the patent cliff and debt arrive together.
Bull Case
The most telling signal at FMC is what management is doing with cash, because in a balance-sheet repair the capital-allocation choices are the strategy. FMC has cut its dividend to 8 cents a quarter, redirecting cash from shareholders to the balance sheet, and set a target of paying down roughly $1.0 billion of debt in 2026 through asset sales and licensing agreements. It has gone further, announcing a review of strategic options that explicitly includes a possible sale of the company. Those are the moves of a board treating deleveraging as the first priority, and for a deeply discounted stock trading below book value, a credible debt-reduction plan is the cleanest path to re-rating.
The franchise underneath the trough is genuinely valuable. FMC is a top-tier crop-protection company, and its filing claims "one of the most productive crop protection pipelines in agriculture," one that "is biased toward new modes of action" [FY2025 10-K, accession 0000037785-26-000041]. New active ingredients are the offset to the patent cliff and they are scaling fast: new-AI sales are guided to between $300 million and $400 million in 2026, growth of more than 75% at the midpoint, and new-active-ingredient sales doubled year over year in the first quarter. A pipeline biased toward novel chemistry is the asset that survives a single product's patent expiry.
The numbers are bottoming on the operating line even as the headline stays ugly. First-quarter 2026 sales of $762 million, excluding India, came in above the midpoint of guidance, volume improved 2% on strength in EMEA and North America, and adjusted EBITDA of $72 million beat the top end of guidance. Management reaffirmed full-year guidance of $3.60 billion to $3.80 billion in revenue and $670 million to $730 million in adjusted EBITDA. On normalized, through-the-cycle margins the price sits below the company's own earnings power, the earnings-power frame lands far above the current price, and book value of $14.54 a share is above the price. If the destocking ends and deleveraging proceeds, the asset value and normalized earnings support a higher price than the trough multiple implies.
Bear Case
The defensible advantage FMC built its profits on is being chipped away in plain sight, and the data shows exactly where. Rynaxypyr, the branded diamide insecticide that historically contributed 30% to 40% of revenue, has lost its core protection; the filing concedes these are "high value diamide insecticides for which our composition of matter patents on the active ingredient itself have expired in most countries" [FY2025 10-K, accession 0000037785-26-000041]. Generics are entering in early 2026, customers have been delaying purchases ahead of them, and pricing is already falling: first-quarter price declined 6%, driven by lower pricing to diamide partners and on branded Rynaxypyr. A company losing patent protection on a third or more of its revenue is watching its moat erode in real time, and the second-quarter outlook calls for a roughly 17% revenue decline as diamide-partner orders fall and India is removed.
The balance sheet turns moat erosion into existential risk. FMC carries extreme leverage, with net debt running many times operating profit and interest coverage under two, and S&P downgraded the company to junk status specifically over the patent cliff. The filing warns that if FMC is "unable to generate sufficient cash flow or raise adequate external financing, including as a result of disruptions in the global credit markets," it "could be forced to" restrict operations [FY2025 10-K, accession 0000037785-26-000041]. The dividend cut to 8 cents and the $1.0 billion debt-reduction plan are necessary precisely because the situation is fragile; management itself has called 2026 a difficult year requiring very heavy lifting. Asset sales to delever in a weak market risk selling good assets at distressed prices.
The valuation looks cheap only because trailing earnings are a wreck, and the normalization that makes it look cheap is not guaranteed. The price is read on through-the-cycle margins, but a patent cliff is not a cycle; it is a permanent reset of the earnings base for the affected products. If the new-active-ingredient pipeline does not scale fast enough to replace the diamide revenue, normalized earnings settle structurally lower than the five-year average the model uses, and the through-the-cycle framing flatters the stock. A junk-rated, highly leveraged company facing the simultaneous loss of its biggest product's patent and a financing market it does not control is a high-risk situation, not a simple value play.
Valuation
FMC is a deeply cyclical crop-protection company whose trailing earnings are crushed, so the price is read against normalized, through-the-cycle operating income rather than the trough, where the operating margin is deeply negative on impairments and restructuring. On that basis the price near $11.54 (June 27, 2026) works out to about 15 times mid-cycle operating profit, a multiple so low that the price sits below what even a sustained 5% annual decline in operating profit would warrant. The framework states this as a bound, not a solve: the price is on the cheap side of what an ordinary decline would justify, which is why the headline reads as within range despite the wreckage in trailing numbers.
The X-ray is sparse because so many models are disabled by negative earnings and cash flow. What remains splits cleanly. The asset and earnings-power frames support the price: book value of $14.54 a share sits above the current price, and the earnings-power frame on five-year-average operating income lands far above it. The growth-DCF frame, by contrast, says expensive, because it extrapolates the recent revenue decline. The characterization is that asset-based, earnings-power, and relative value support the price while growth-DCF does not, an asset-supported value name rather than a growth bet.
The honest synthesis is that the valuation is cheap if the normalization is real and dangerous if it is not. The asset value and through-the-cycle earnings power genuinely exceed the price, which is the bull case for a patient, risk-tolerant buyer. But the leverage is extreme, the credit rating is junk, and the patent cliff permanently lowers the earnings base for a large slice of revenue, so the through-the-cycle average the model leans on may overstate the new normal. The valuation rewards a successful deleveraging-and-pipeline transition and punishes a failure of it; there is little middle ground at this balance sheet.
Catalysts
The most recent catalyst was the first-quarter 2026 report, which beat a low bar. FMC reported sales of $762 million excluding India, above the midpoint of guidance and down 4% year over year, with volume up 2% and adjusted EBITDA of $72 million exceeding the top end of guidance, though it posted a GAAP net loss driven largely by tax charges from increased valuation allowances. Management reaffirmed full-year guidance of $3.60 billion to $3.80 billion in revenue and $670 million to $730 million in adjusted EBITDA, while guiding the second quarter to a roughly 17% revenue decline on lower diamide-partner volume and the removal of India.
The dominant overhang and catalyst is the Rynaxypyr patent cliff. Core composition-of-matter patents have expired in most countries, generics are arriving in early 2026, and the timing and severity of the pricing and volume hit to this 30%-to-40%-of-revenue product is the single biggest swing factor. The offset to watch is the new-active-ingredient ramp, guided to $300 million to $400 million in 2026 with growth over 75%, which must scale to replace the diamide revenue.
The balance-sheet actions are the other catalyst set. FMC plans to pay down about $1.0 billion of debt in 2026 through asset sales and licensing, cut the dividend to 8 cents to conserve cash, and is exploring strategic options including a possible sale of the company. Progress on debt reduction, any asset-sale announcements, the outcome of the strategic review, and any further credit-rating action after the S&P downgrade to junk are all material events. Analyst views are split between deep-value rebound potential and distress risk, which is appropriate for a high-risk turnaround.
Sources: FMC Q1 2026 results above guidance, FMC IR; FMC Q1 2026 revenue and EBITDA detail, Global Agriculture; FMC downgraded to junk on patent cliff, Investing.com; FMC explores strategic options including sale, StockTitan; FMC holds dividend at 8 cents amid debt downgrade, BriefGlance.
Peer Cohorts (Per Segment, With Filing Citations)
Agricultural Solutions (single reportable segment) (reported)
- CC (Chemours Co)
- (no filing in the citation store)
- OLN (Olin Corporation)
- (no filing in the citation store)
- HUN (Huntsman Corporation)
- (no filing in the citation store)
- EMN (EASTMAN CHEMICAL CO)
- (no filing in the citation store)
- CE (CELANESE CORPORATION)
- (no filing in the citation store)
- WLK (Westlake Corporation)
- (no filing in the citation store)
- DD (DUPONT DE NEMOURS, INC.)
- (no filing in the citation store)
- ALB (Albemarle Corporation)
- (no filing in the citation store)
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.