Value
7.6/10data confidence 67%| Component | Sub-score |
|---|---|
| P/S | 10.0 |
| EV/EBITDA | 0.0 |
| Fwd P/E | 8.8 |
| PEG | 10.0 |
- ▸Forward P/E: 12.5x
- ▸PEG: 0.08
- ▸Attractively valued
KRO · Why this verdict
Why Kronos Worldwide (KRO) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictSELL
Overall score5.5/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Kronos Worldwide is a cyclical specialty chemicals maker recovering from a loss-making year, with revenue up to $558M in the June 2026 quarter and the last two quarters beating estimates, but the shares are 7.6% above the analyst target and quality is below par.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Quarterly revenue rose to $558.1M in June 2026 from $494.4M a year earlier and EPS turned positive at $0.13 after losses of $0.72 and $0.04. Revenue quarters | Quarterly revenue should stay above $520M and EPS should remain positive over the next 12 months. | ↑Improving |
| CounterThe recovery is recent and cyclical; the company missed EPS by wide margins in the 4 quarters before it, so reversal is plausible. | ||
EPS has swung between beats of 86% and 67% in the last two quarters and misses of 213% and 433% in the two before, with an average surprise of -123%. Last 4 quarters | EPS surprise should stay at or above 0% in the next two reports. | ↑Improving |
| CounterSmall EPS bases exaggerate percentage surprises, but the pattern still shows low earnings predictability. | ||
At $7.82 the shares trade 7.6% above the $7.22 analyst target against 9.1% downside to the $7.32 stop. Analyst target | Earnings recovery should lift analyst targets above $7.82 over the next 12 months. | →Stable |
| CounterMomentum is positive at 6.1/10 with rising OBV and a forward P/E of 12.7x, so the price could keep drifting higher. | ||
Quality scores 3.0/10 with no competitive moat and zero ROE and net margin, though the current ratio component is strong at 9.7. Quality breakdown | Net margin should turn positive and quality should rise above 4.0 within 12 months. | →Stable |
| CounterThe balance sheet is liquid and the peer value rank is high (8.75), so quality scores may understate a recovering cyclical. | ||
The put/call ratio is 1.50 with implied volatility of 85%, and earnings are due in 12 days. Risk breakdown | Put/call ratio should fall below 1.0 as results improve over the next 12 months. | ↓Deteriorating |
| CounterElevated put buying can reflect hedging by holders, not outright bearish bets, and open interest data is not available. | ||
Quarterly revenue rose to $558.1M in June 2026 from $494.4M a year earlier and EPS turned positive at $0.13 after losses of $0.72 and $0.04.
↑ImprovingRevenue quarters
- Expectation
- Quarterly revenue should stay above $520M and EPS should remain positive over the next 12 months.
CounterThe recovery is recent and cyclical; the company missed EPS by wide margins in the 4 quarters before it, so reversal is plausible.
EPS has swung between beats of 86% and 67% in the last two quarters and misses of 213% and 433% in the two before, with an average surprise of -123%.
↑ImprovingLast 4 quarters
- Expectation
- EPS surprise should stay at or above 0% in the next two reports.
CounterSmall EPS bases exaggerate percentage surprises, but the pattern still shows low earnings predictability.
At $7.82 the shares trade 7.6% above the $7.22 analyst target against 9.1% downside to the $7.32 stop.
→StableAnalyst target
- Expectation
- Earnings recovery should lift analyst targets above $7.82 over the next 12 months.
CounterMomentum is positive at 6.1/10 with rising OBV and a forward P/E of 12.7x, so the price could keep drifting higher.
Quality scores 3.0/10 with no competitive moat and zero ROE and net margin, though the current ratio component is strong at 9.7.
→StableQuality breakdown
- Expectation
- Net margin should turn positive and quality should rise above 4.0 within 12 months.
CounterThe balance sheet is liquid and the peer value rank is high (8.75), so quality scores may understate a recovering cyclical.
The put/call ratio is 1.50 with implied volatility of 85%, and earnings are due in 12 days.
↓DeterioratingRisk breakdown
- Expectation
- Put/call ratio should fall below 1.0 as results improve over the next 12 months.
CounterElevated put buying can reflect hedging by holders, not outright bearish bets, and open interest data is not available.
Per-dimension breakdown
Quality
3.0/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 0.0 |
| ROA | 0.0 |
| Gross margin | 0.0 |
| Op margin | 2.7 |
| Net margin | 0.0 |
| Current ratio | 9.7 |
| Moat | 5.0 |
| Piotroski F | 6.7 |
- ▸No competitive moat
Growth
7.8/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 5.7 |
| EPS growth | 10.0 |
Momentum
4.3/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 6.8 |
| OBV | 1.0 |
| MA position | 7.0 |
| Volume | 1.1 |
- ▸Volume distribution (falling OBV)
- ▸Above 200-day MA
Sentiment
5.9/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 6.5 |
| Analyst rating | 5.0 |
| Price target | 6.5 |
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.0 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
Peer rank
5.3/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 8.8 |
| quality rank | 1.1 |
| growth rank | 7.1 |
Technical
4.9/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 3.9 |
| support resistance | 3.9 |
| 52w position | 6.9 |
Risk (lower is worse)
5.0/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 7.5 |
| days to cover | 7.8 |
| volatility | 3.4 |
| put call | 3.3 |
| implied vol | 0.0 |
| beta | 6.7 |
| debt equity | 6.3 |
- ▸High IV: 81%
Catalyst
4.2/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 3.3 |
| earnings timing | 5.0 |
| surprise avg | 0.0 |
| dividend safety | 6.8 |
| news activity | 5.0 |
- ▸Earnings concerns: 2B/2M
- ▸Earnings in 7 days
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCK:QUALITY_FLOORPassed (5)
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (3)
- MOMENTUM:4.3<4.5
- ASYMMETRY:-0.8=NEGATIVE
- EARNINGS_PROXIMITY:7d<=7d
Warning (0)
none
Reward-to-Risk
-0.81
Upside
-6.2%
Downside
7.7%
Sizing output
AVOID
SetupRange Bound — RSI 47 mid-range, Bollinger mid-band
EdgeSector Rotation — Basic Materials sector out of favor, value=7.6
SuitabilityAggressive — MCap $0.9B<$5B
Investment implication
The SELL_IF_HOLDING verdict reflects the MOMENTUM gate's 4.3<4.5 outcome against Growth at 7.8 and asymmetric R:R of -0.81.
The strongest dimensions are Growth at 7.8, Value at 7.6, and Sentiment at 5.9; the weakest are Quality at 3.0, Catalyst at 4.2, and Momentum at 4.3. The V9 engine flagged 3 failed gates, producing an asymmetric reward-to-risk of -0.81 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Revenue And Earnings Recovery
Trip ifQuarterly revenue falls below $450M from the current $558M.
- P2Volatile Earnings Record
Trip ifEPS falls below $0.00 in the next quarterly report.
- P3Price Above Analyst Target
Trip ifShare price falls below the $7.32 stop-loss level.
- P4Below Par Quality No Moat
Trip ifQuality score stays below 4.0 for 4 consecutive quarters from the current 3.0.
- P5Bearish Options Positioning
Trip ifPut/call ratio rises above 2.0 from the current 1.50.