How does axalta coating make money?

axalta coating generates $5.1B in annual revenue (annual revenue · their business grew -3.0% last year).

What is AXTA's XVARY composite score?

axalta coating (AXTA) has an XVARY composite score of 55/100, rated below average. This combines growth, value, risk, and momentum factors.

AXTA — axalta coating stock analysis

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what it is

Axalta makes coatings that protect cars, trucks, and industrial equipment from wear, rust, and weather.

how it gets paid

Last year Axalta Coating made $5.1B in revenue. Refinish was the main engine at $2.09B, or 41% of sales.

why growth slowed
Revenue fell 3.0% last year. The key number was the 14.49% miss, because the market forgives noise faster than it forgives a miss.

what just happened

Axalta missed by 14.49% on EPS, posting $0.59 against $0.69 expected.

At a glance

B+ balance sheet — decent shape, but not bulletproof

45/100 earnings predictability — expect surprises

19.7x trailing p/e — priced about right

8.0% return on capital — nothing to write home about

$2.00 fy2027 eps est

xvary composite: 55/100 — below average

What they do

Axalta makes coatings that protect cars, trucks, and industrial equipment from wear, rust, and weather.

You do not swap coatings like a phone app. Leaving is painful because your exact recipe, service, and warranty history are already built into the account. 62% of 2024 sales came from outside the U.S. versus 38% at home, and 12,800 employees keep the system running.

industrials mid-cap coatings global-sales merger

How they make money

$5.1B annual revenue · their business grew -3.0% last year

Industrial

$1.25B

Refinish

$2.09B

Mobility

$1.76B

The products that matter

vehicle and industrial coatings

Performance Coatings

$5.1B revenue

it's the whole $5.1B business, and sales fell 3.0% last year. if you want the standalone thesis to work, this line needs to stop shrinking.

the whole story

Key numbers

$45

target price

That is 32% above $34.21, or $10.79 more per share.

$3.2B

long-term debt

That is 30% of capital, so the balance sheet is not a toy.

23.0%

op margin

That means 23 cents of every sales dollar stays after operating costs.

8.0%

roc

You get 8 cents back for each dollar tied up in the business.

Financial health

B+

strength

balance sheet grade B+ — solid but not elite
risk rank 3 — safer than 50% of stocks
price stability 65 / 100
long-term debt $3.2B (30% of capital)
net profit margin 10.5% — keeps 10 cents of every dollar in revenue
return on equity 13% — $0.13 profit for every $1 investors have put in

B+ — functional but not a standout on the balance sheet.

Total return vs. market

You invested $10,000 in AXTA 3 years ago → it's now worth $11,680.

The index would have given you $13,880.

same period. same starting point. AXTA trailed the market by $2,200.

source: institutional data · total return

What just happened

missed estimates

Axalta missed by 14.49% on EPS, posting $0.59 against $0.69 expected.

Revenue was $3.9B, up 199% vs. prior year. That is a giant number next to a small miss, which is how bad quarters survive.

$3.9B

revenue

$0.59

eps

n/a

EPS miss

The key number was the 14.49% miss, because the market forgives noise faster than it forgives a miss.

axalta coating systems has agreed to be acquired.
last november, the company inked a definitive merger agreement with industry peer akzonobel.

the allstock transaction is scheduled to close in late 2026 or early 2027, and is subject to shareholder and regulatory approvals.
under the terms of the deal, axalta stockholders will receive 0.6539 of akzonovel shares for each share held, and would own 45% of the combined entity upon its conclusion.

the merger would create a welldiversified global entity, offering coating solutions across powder, aerospace, refinish, mobility, marine & protective, industrial coatings, and decorative paints end markets.
managements expect the combination will generate $600 million in pre-tax run-rate, with 90% of the savings achieved within the first three years, thanks to footprint optimization, improved supply-chain management, procurement, and sg&a efficiencies.
on its own, the company reported lackluster operating results in 2025.

source: company earnings report, 2026

What could go wrong

the top risk is the akzonobel deal not closing on time or on current terms.

∘

med

approval and timing

The deal is targeted for late 2026 or early 2027 and still needs shareholder and regulatory approval. If that clock slips, the market goes back to judging AXTA on its own numbers.

The exchange ratio is 0.6539 AkzoNobel shares per AXTA share. If terms change or timing drags, the value you are underwriting changes with it.

∘

med

standalone growth is weak

Revenue fell 3.0% last year, and full-year EPS slipped to $1.74 from $1.78. That is not a collapse. It is enough to make the standalone case harder to get excited about.

At 19.7x trailing earnings, the stock is not priced for a serious downturn. Another year of shrinking sales would make that multiple feel generous.

∘

med

debt cuts the cushion

Long-term debt is $3.2B, or 30% of capital. Net margin is 8.0%, so there is less room for error if auto builds, industrial demand, or integration execution disappoint.

22.5% operating margin sounds strong. Only 8.0% reaches net profit. That gap is where financing and other costs start to matter.

∘

med

$600M of savings is still a promise

Management is targeting $600M of pre-tax run-rate savings, with 90% achieved inside three years. Until the plants are integrated and the overhead comes out, that number is a slide, not cash.

If the savings arrive late or smaller than planned, the combined-company rerating thesis loses one of its main supports.

If the deal slips or breaks, you are back to a standalone coatings company with $5.1B in revenue that shrank 3.0% last year and carries $3.2B of long-term debt.

source: institutional data · regulatory filings · risk analysis

Pay attention to

deal

approval timeline

late 2026 to early 2027 is the stated close window. any delay matters because the stock is already trading on the merger, not just on coatings demand.

earnings

next quarterly report

watch whether sales stay near the $1.26B q4 pace and whether EPS starts climbing back from the $1.74 full-year level.

trend

does the top line stop shrinking

revenue fell 3.0% last year. if that number stays negative, the standalone bull case gets thin fast.

margin

operating profit versus net profit

22.5% operating margin and 8.0% net margin tell two different stories. keep an eye on whether that gap narrows.

Analyst rankings

risk profile

average

stability score 3 — this sits in the middle. not a bunker stock, not chaos.

earnings predictability

45 / 100

in human-speak, the next few quarters are harder to forecast than management would like.

street target

$45 midpoint

the published midpoint implies about 32% upside from $34.21, but that optimism now leans on the deal closing.

source: institutional data

Institutional activity

187 buyers vs. 199 sellers in 3q2025. total institutional holdings: 0.2B shares.

source: institutional data · 1q2025-3q2025

source: institutional data

Price targets

3-5 year target range

$29 $61

$34 current price

$45 target midpoint · +32% from current · 3-5yr high: $90 (+165% · 27% ann'l return)

source: institutional data · analyst targets

The deep dive

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what you'll get

dcf valuation model

bull / base / bear scenarios

competitive moat breakdown

quarterly earnings tracker

operating model projections

risk matrix with kill criteria

original price target + conviction

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