Have you been paying attention to shares of Element Solutions (ESI)? Shares have been on the move with the stock up 23.5% over the past month. The stock hit a new 52-week high of $36.38 in the previous session. Element Solutions has gained 41.8% since the start of the year compared to the 22.5% move for the Zacks Basic Materials sector and the 15.5% return for the Zacks Chemical - Specialty industry.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, having beaten the Zacks Consensus Estimate in each of the last four quarters. In its last earnings report on February 17, 2026, Element Solutions reported EPS of $0.37 versus consensus estimate of $0.36.
Valuation Metrics
Though Element Solutions has recently hit a 52-week high, what is next for Element Solutions? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
Element Solutions has a Value Score of C. The stock's Growth and Momentum Scores are C and B, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 20.4X current fiscal year EPS estimates, which is a premium to the peer industry average of 19.3X. On a trailing cash flow basis, the stock currently trades at 16.7X versus its peer group's average of 14.3X. Additionally, the stock has a PEG ratio of 1.46. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to consider the stock's Zacks Rank, as this is even more important than the company's VGM Score. Fortunately, Element Solutions currently has a Zacks Rank of #2 (Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Element Solutions fits the bill. Thus, it seems as though Element Solutions shares could still be poised for more gains ahead.
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Element Solutions Inc. (ESI): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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