Ingevity Corporation’s NGVT stock looks promising at the moment. Its shares have popped roughly 41% over the past six months. NGVT is expected to benefit from the strategic repositioning of its Performance Chemicals segment, strategic acquisitions and actions to drive growth.

We are positive on the company’s prospects and believe that the time is right for you to add the stock to the portfolio as it is poised to carry the momentum ahead.

Let's see what makes NGVT stock an attractive investment option at the moment.

NGVT’s Earnings Estimates Northbound

Earnings estimates for NGVT for 2025 have been going up over the past 60 days, reflecting analysts’ optimism. The Zacks Consensus Estimate for 2025 has increased by 29%.

NGVT’s Positive Earnings Surprise History

Ingevity has outpaced the Zacks Consensus Estimate in three of the trailing four quarters. In this time frame, it has delivered an earnings surprise of roughly 202.9%, on average.

Ingevity’s Superior Return on Equity (ROE)

ROE is a measure of a company’s efficiency in utilizing shareholder’s funds. ROE for the trailing 12-months for Ingevity is 41.4%, above the industry’s level of 15.5%.

Strategic Repositioning and Acquisitions to Aid NGVT

Ingevity is taking several actions to expand capacity and drive long-term growth. It remains committed to investing organically. Ingevity is also committed to capturing the maximum value for its products.

The company is expected to benefit from the repositioning of its Performance Chemicals segment, which is aimed at lowering exposure to lower-margin end markets. The move includes consolidating segment operations at its North Charleston facility by moving oleo chemical refining to the North Charleston site’s secondary refinery as well as the closure of its Crossett facility. These actions further simplify the segment’s manufacturing footprint and create significant cost savings. NGVT realized roughly $84 million of savings from repositioning actions in 2024. It sees around $10-$25 million in incremental savings in 2025.

Ingevity remains focused on enhancing shareholder value through improved EBITDA, improving margins and strong cash flows. The company is seeing the benefits of the repositioning on its earnings and cash flows. Operational improvements leading to lower input costs and better manufacturing efficiency are also aiding performance in its Performance Materials unit. 

The acquisition of the Capa caprolactone business enabled the company with a new technology platform to drive revenue and earnings growth. Capa has a strong and market-leading business that focuses on high-growth end-use applications. NGVT, in July 2024, expanded its Capa caprolactone distribution network by selecting Ultrapolymers Group as the distributor for Capa Bioplastics in Europe. The acquisition of Ozark Materials has also strengthened the company’s position in the paving construction industry.

Ingevity Corporation Price and Consensus

Ingevity Corporation price-consensus-chart | Ingevity Corporation Quote

NGVT’s Zacks Rank & Other Key Picks

NGVT currently carries a Zacks Rank #1 (Strong Buy).

Other top-ranked stocks in the Basic Materials space are Axalta Coating Systems Ltd. AXTA, Carpenter Technology Corporation CRS and Orla Mining Ltd. ORLA. While AXTA sports a Zacks Rank #1, CRS and ORLA carry a Zacks Rank #2 (Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Axalta Coating’s 2025 earnings is pegged at $2.51, indicating a rise of 6.8% from year-ago levels. AXTA beat the consensus estimate in each of the trailing four quarters. In this time frame, it has delivered an earnings surprise of roughly 16.3%, on average. 

Carpenter Technology beat the Zacks Consensus Estimate in each of the last four quarters, with the average earnings surprise being 15.7%. The company's shares have soared roughly 169% in the past year. 

The Zacks Consensus Estimate for Orla Mining’s 2025 earnings is pegged at 43 cents, indicating a rise of 80.6% from year-ago levels. The consensus estimate for ORLA’s 2025 earnings has increased by 30.3% in the past 60 days.

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This article originally published on Zacks Investment Research (zacks.com).

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