The average target price of ORGN is 0.50 and suggests 3% downside potential. Usually, this means a SELL recommendation among investment firms, or a recommendation to decrease one's position in this instrument in the next 12 months. The most optimistic analyst has a target price of 0.5. This is lower than the current market price, meaning that even the most optimistic analyst does not see upside potential. On the other hand, the most pessimistic analyst has a target price of 0.5. This is equivalent to 3% downside potential in the worst case. 

Origin Materials, Inc., together with its subsidiaries, operates as a carbon-negative materials company. The company develops a proprietary biomass conversion platform to convert biomass, or plant-based carbon into building block chemicals chloromethylfurfural and hydrothermal carbon, as well as other oils and extractives and other co-products. Origin Materials, Inc. is headquartered in West Sacramento, California.

Origin Materials, Inc.

Basic Materials

The company does not pay dividends at all, or it pays them sporadically. There have only been a few years with dividend payments in the past ten years. 

ORGN reported revenue of USD 30mn in the last 12 months, down 4% from FY24. At the same time, the dynamics of cash flow, as measured by free cash flow (FCF), were drastically different. EPS grew 1 011% from FY24 to USD -0.09. Market expects EPS to reach USD -0.60 in FY25.

Over the last six months, the stock performance has varied, with an increase following a drop. The stock's price trend wasn't definitive when matched against its global counterparts from the same sector and industry (as depicted above). Within the past six months, its performance has trailed this peer group's by 47ppts and its growth decelerated by 19ppts in the past month. This is equally valid for peers from the same country and industry. Given the stock's valuation versus its peers, its total price movement is slightly unfavourable.

The company has reported very poor EBITDA margins compared to its global peers in recent years. EBITDA margin amounted to -289.2% in the last 12 months, a decline from 97.0% in FY23. 

Historically, ORGN has reported very poor net margins compared to its global peers. Specifically, in the last 12 months, this metric equalled -322.0%, down from 73.9% in FY23. 

Another important profitability metric, return on assets (RoA), amounted to -23.7% in the last 12 months, a decrease from 4.5% in FY23. The market analysts predict that RoA will be 7.5% in FY24, more robust than its peers in this period. 

In the last 12 months, the return on capital employed (RoCE) declined to -24.5%, below the peers. The consensus estimate for FY24 for RoCE is 8.7%, again behind the peers. 

Origin Materials, Inc. reported a return on equity (RoE) of -26.1% in the last 12 months, down from 5.3% in FY23. The market consensus projects an RoE of 8.2% in FY24, again behind its peers. 

The ratio of return on invested capital (RoIC) to the weighted average cost of capital (WACC) has been 0.0 in the past several years. This ratio implies a fragile shareholder value creation. 

The institutional, legal, and compliance risks associated with the company's country are minimal. In combination with stringent business standards, shareholder rights are very highly protected.

ORGN has below average trading liquidity. The average private investor can sell his common position in the stock in a single trading day. Liquidity is usually stable and remains extremely favourable on the days with the lowest activity. The trading volume mostly stays the same even under highly turbulent market conditions. The stock has a tiny market capitalisation, which usually makes its trading liquidity erratic and unpredictable. 

No other major risks have been identified.

The risk of default is moderate. We note low margin volatility and adequate interest coverage, among the positive credit factors. Among the negative credit factors, we point to slow historical revenue growth, bleak profitability, and negligible return on capital.

In highly turbulent market conditions, ORGN is exceptionally volatile. In other words, the stock will be among the worst-performers in times of extreme market volatility or shocking company news. Standalone, the worst-day losses (less than 1% of the time) will likely be critical. 

In normal market circumstances, ORGN is exceptionally volatile. Put differently, without outstanding market volatility or shocking company news, the stock's price will change quite unpredictably. The stock's losses on its worst days (less than 1-5% of the time) will range from critical to immense. 

From both historical and forecast perspectives, the stock is fairly priced compared to similar stocks. Specifically, the stock is undervalued on EV/EBITDA. 

Origin Materials, Inc.

$ 0.49

3

Origin Materials, Inc.

$ 0.49

3

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$ 0.49

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