FMC
FMC
Hold 2026-03-24
Model
DCF
Price at Report
$14.23
Base IV
$16.06
Bear IV
$-7.69
Bull IV
$53.68
Entry Zone: -8-15 · Sell Above: 46
Bore Family Office
Valuation Report — FMC Corporation (FMC) • March 24, 2026
Unlevered DCF (FCFF @ WACC) • Discount Rate: 8.00% • Current Price: $14.23
Prepared by Lurch • Bore Family Office • Data: Finnhub, StockAnalysis.com, S&P Global Market Intelligence
🏢 Business Overview
FMC Corporation is a global agricultural sciences company that develops and markets crop protection chemicals — insecticides, herbicides, and fungicides — serving farmers worldwide. Founded in 1910 and headquartered in Philadelphia, FMC operates across 53 countries with a particular strength in Latin America (largest market) and Asia-Pacific. The company also has a growing biologicals and crop nutrition business. FMC was formerly a diversified industrial conglomerate that transformed into a pure-play ag chemicals company after divesting its lithium and health/nutrition businesses in 2018-2019.
FY2025 was catastrophic: a $2.24B net loss driven by massive goodwill and intangible asset impairments, reflecting the severe ag chemical downcycle. Revenue declined 18.4% to $3.47B (from $5.8B peak in FY2022) as channel destocking, generic competition from China, and commodity deflation ravaged the sector. The dividend was cut 86% (from $2.32/yr to $0.32/yr). Total debt of $4.07B against a $1.78B market cap creates an extremely leveraged balance sheet. However, the company retains strong IP in novel active ingredients, a growing biologicals pipeline, and a global distribution network that positions it for recovery when the cycle turns.
| Business Segment | Revenue | % of Total | YoY Growth | Margin | Notes |
|---|---|---|---|---|---|
| Latin America | $1,250M | 36% | -15.0% | — | Largest region; Brazil dominates; hardest hit by destocking and FX headwinds |
| North America | $730M | 21% | -12.0% | — | US/Canada; impacted by generic competition and distributor destocking |
| EMEA | $660M | 19% | -20.0% | — | Europe, Middle East, Africa; regulatory headwinds; weakest region |
| Asia | $830M | 24% | -25.0% | — | China, India, SE Asia; Chinese generic dumping severely impacted pricing |
| Blended Growth Rate | — | 100% | -17.7% | — | Weighted avg across segments |
🔍 Quality Scorecard
| Metric | Value | Assessment |
|---|---|---|
| ROIC | -61.0% | <8% weak |
| FCF Margin | -3.0% | <5% weak |
| Debt / EBITDA | 5.5x | >4x elevated |
| Revenue Trend | Declining 3yr | 3-year directional trend |
| FCF Margin Trend | Contracting | Directional margin trajectory |
| Analyst Revisions | Downward revisions | Last 90 days consensus direction |
⚠️ Elevated value trap risk — verify thesis before acting
📊 Financial Snapshot
| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue ($M) | $5,045 | $5,802 | $4,487 | $4,246 | $3,467 |
| EBITDA ($M) | $1,205 | $1,314 | $740 | $683 | $-1,455 |
| Operating Income ($M) | $1,035 | $1,144 | $556 | $507 | $-1,628 |
| Net Income ($M) | $740 | $737 | $1,322 | $341 | $-2,239 |
| EPS (diluted) | $6.26 | $6.58 | $10.53 | $2.72 | $-17.88 |
| Free Cash Flow ($M) | $799 | $518 | $-434 | $669 | $-103 |
| Annual DPS | $1.970 | $2.170 | $2.320 | $2.320 | $1.820 |
| Total Debt ($M) | $3,173 | $3,274 | $3,958 | $3,365 | $4,075 |
| Rev YoY Growth | — | +15.0% | -22.7% | -5.4% | -18.3% |
| Gross Margin | 42.8% | 40.1% | 40.8% | 38.8% | 37.0% |
| EBITDA Margin | 23.9% | 22.6% | 16.5% | 16.1% | -42.0% |
| Operating Margin | 20.5% | 19.7% | 12.4% | 11.9% | -47.0% |
| Net Margin | 14.7% | 12.7% | 29.5% | 8.0% | -64.6% |
⚙️ WACC Build (DCF)
| Input | Value | Notes |
|---|---|---|
| Risk-Free Rate (Rf) | 4.30% | 10-yr US Treasury yield |
| Beta (β) | 0.600 | Market beta (Finnhub) |
| Equity Risk Premium (ERP) | 5.5% | Damodaran US ERP |
| Cost of Equity (Ke) | 7.60% | Ke = Rf + β × ERP |
| Pre-Tax Cost of Debt | 6.00% | Interest exp / gross debt |
| After-Tax Cost of Debt (Kd) | 4.50% | × (1 − 25%) |
| Weight Equity (We) | 30.4% | Mkt cap $0.0B |
| Weight Debt (Wd) | 69.6% | Gross debt $0.0B |
| WACC | 8.00% | DCF discount rate |
📈 DCF Scenarios
$-8
🔴 Bear
$16
📊 Base
$54
🚀 Bull
$14.23
Current Price
$18
Analyst Avg PT
| Scenario | Stage 1 (Yrs 1–5) | Stage 2 (Yrs 6–10) | Terminal g | WACC | Intrinsic Value | vs Price |
|---|---|---|---|---|---|---|
| 🔴 Bear | -3.0% | 0.0% | 2.0% | 10.00% | $-8 | ▼154.0% |
| 📊 Base | 5.0% | 3.0% | 2.5% | 8.00% | $16 | ▲12.9% |
| 🚀 Bull | 10.0% | 6.0% | 3.0% | 7.00% | $54 | ▲277.2% |
📋 Full 10-Year Projection Tables
Bear Scenario
Stage 1: -3.0% | Stage 2: 0.0% | Terminal: 2.0%
| Period | Stage | FCFF | PV of FCFF | Cumulative EV |
|---|---|---|---|---|
| Year 1 | Stage 1 | $0.25B | $0.23B | $0.23B |
| Year 2 | Stage 1 | $0.24B | $0.20B | $0.43B |
| Year 3 | Stage 1 | $0.24B | $0.18B | $0.61B |
| Year 4 | Stage 1 | $0.23B | $0.16B | $0.77B |
| Year 5 | Stage 1 | $0.22B | $0.14B | $0.91B |
| Year 6 | Stage 2 | $0.22B | $0.13B | $1.03B |
| Year 7 | Stage 2 | $0.22B | $0.11B | $1.15B |
| Year 8 | Stage 2 | $0.22B | $0.10B | $1.25B |
| Year 9 | Stage 2 | $0.22B | $0.09B | $1.35B |
| Year 10 | Stage 2 | $0.22B | $0.09B | $1.43B |
| Terminal | — | TV=$2.8B | PV(TV)=$1.1B (43% of EV) | EV=$2.5B |
| Intrinsic Value | — | — | EV $2.5B − Net Debt → Equity / Shares | $-8 |
How the price per share is derived: Each year's projected free cash flow is discounted back at WACC (10.00%) to get its present value. After Year 10, FCF grows at the terminal rate (2.0%) in perpetuity — the Gordon Growth formula gives a terminal value of FCF11 / (WACC − gT) = $2.8B. That terminal value is discounted back 10 years to today's dollars (PV of TV = $1.1B). Enterprise Value = PV of FCFs ($1.4B) + PV of TV ($1.1B) = $2.5B. Subtracting net debt gives equity value of $-1.0B, divided by shares outstanding = $-8 per share.
Base Scenario
Stage 1: 5.0% | Stage 2: 3.0% | Terminal: 2.5%
| Period | Stage | FCFF | PV of FCFF | Cumulative EV |
|---|---|---|---|---|
| Year 1 | Stage 1 | $0.27B | $0.25B | $0.25B |
| Year 2 | Stage 1 | $0.29B | $0.25B | $0.50B |
| Year 3 | Stage 1 | $0.30B | $0.24B | $0.74B |
| Year 4 | Stage 1 | $0.32B | $0.23B | $0.97B |
| Year 5 | Stage 1 | $0.33B | $0.23B | $1.20B |
| Year 6 | Stage 2 | $0.34B | $0.22B | $1.41B |
| Year 7 | Stage 2 | $0.35B | $0.21B | $1.62B |
| Year 8 | Stage 2 | $0.36B | $0.20B | $1.81B |
| Year 9 | Stage 2 | $0.37B | $0.19B | $2.00B |
| Year 10 | Stage 2 | $0.38B | $0.18B | $2.18B |
| Terminal | — | TV=$7.2B | PV(TV)=$3.3B (60% of EV) | EV=$5.5B |
| Intrinsic Value | — | — | EV $5.5B − Net Debt → Equity / Shares | $16 |
How the price per share is derived: Each year's projected free cash flow is discounted back at WACC (8.00%) to get its present value. After Year 10, FCF grows at the terminal rate (2.5%) in perpetuity — the Gordon Growth formula gives a terminal value of FCF11 / (WACC − gT) = $7.2B. That terminal value is discounted back 10 years to today's dollars (PV of TV = $3.3B). Enterprise Value = PV of FCFs ($2.2B) + PV of TV ($3.3B) = $5.5B. Subtracting net debt gives equity value of $2.0B, divided by shares outstanding = $16 per share.
Bull Scenario
Stage 1: 10.0% | Stage 2: 6.0% | Terminal: 3.0%
| Period | Stage | FCFF | PV of FCFF | Cumulative EV |
|---|---|---|---|---|
| Year 1 | Stage 1 | $0.29B | $0.27B | $0.27B |
| Year 2 | Stage 1 | $0.31B | $0.27B | $0.54B |
| Year 3 | Stage 1 | $0.35B | $0.28B | $0.82B |
| Year 4 | Stage 1 | $0.38B | $0.29B | $1.11B |
| Year 5 | Stage 1 | $0.42B | $0.30B | $1.41B |
| Year 6 | Stage 2 | $0.44B | $0.30B | $1.71B |
| Year 7 | Stage 2 | $0.47B | $0.29B | $2.00B |
| Year 8 | Stage 2 | $0.50B | $0.29B | $2.29B |
| Year 9 | Stage 2 | $0.53B | $0.29B | $2.58B |
| Year 10 | Stage 2 | $0.56B | $0.28B | $2.86B |
| Terminal | — | TV=$14.4B | PV(TV)=$7.3B (72% of EV) | EV=$10.2B |
| Intrinsic Value | — | — | EV $10.2B − Net Debt → Equity / Shares | $54 |
How the price per share is derived: Each year's projected free cash flow is discounted back at WACC (7.00%) to get its present value. After Year 10, FCF grows at the terminal rate (3.0%) in perpetuity — the Gordon Growth formula gives a terminal value of FCF11 / (WACC − gT) = $14.4B. That terminal value is discounted back 10 years to today's dollars (PV of TV = $7.3B). Enterprise Value = PV of FCFs ($2.9B) + PV of TV ($7.3B) = $10.2B. Subtracting net debt gives equity value of $6.7B, divided by shares outstanding = $54 per share.
🔲 Sensitivity Table
| WACC \ gT | 1.5% | 2.0% | 2.5% | 3.0% | 3.5% |
|---|---|---|---|---|---|
| 6.0% | $30 | $35 | $42 | $50 | $62 |
| 6.5% | $24 | $28 | $33 | $39 | $47 |
| 7.0% | $19 | $22 | $26 | $31 | $37 |
| 7.5% | $15 | $18 | $21 | $24 | $29 |
| 8.0% | $12 | $14 | $16 | $19 | $22 |
| 8.5% | $9 | $10 | $12 | $15 | $17 |
| 9.0% | $6 | $8 | $9 | $11 | $13 |
| 9.5% | $4 | $5 | $6 | $8 | $10 |
| 10.0% | $2 | $3 | $4 | $5 | $7 |
Green = >10% above current price. Red = >10% below. Gold = within ±10%.
📉 Long-Term Price Trend Channel
Log-linear trend fitted to full price history. ±1.5σ bands. Green shaded zone = bottom 25% of historical range — historically attractive entry.
🏦 Comparable Valuation
| Company | Fwd P/E | EV/EBITDA | Net Debt/EBITDA | Div Yield | Note |
|---|---|---|---|---|---|
| FMC (current) | 8.1x | ~8x | 5-6x | 2.3% | Deep distress; ag downcycle |
| CTVA (Corteva) | 20.0x | 14.0x | 1.0x | 1.2% | Ag peer; much stronger balance sheet |
| SYT (Syngenta) | 15.0x | 11.0x | 2.5x | 2.0% | Swiss ag peer; Chinese-owned |
| AMVAC (AMVX) | 12.0x | 8.5x | 2.0x | 0.8% | Smaller specialty ag chemicals |
| NTR (Nutrien) | 14.0x | 9.0x | 2.5x | 4.0% | Diversified ag; stronger balance sheet |
💰 Dividend / Distribution Analysis
| Metric | Value |
|---|---|
| Annual DPS | $0.320 |
| Current Yield | 2.25% |
| Consecutive Growth Years | 0 |
| 1-yr DPS CAGR | +-43.1% |
| 3-yr DPS CAGR | +-20.0% |
| 5-yr DPS CAGR | +-15.0% |
| 10-yr DPS CAGR | — |
| Payout Ratio (DPS/EPS) | 0.0% |
| FCF Payout Ratio | 0.0% |
| Sustainability Verdict | At Risk |
FMC cut its dividend 86% in late 2025 — from $0.58/qtr ($2.32/yr) to $0.08/qtr ($0.32/yr). This reflects the severity of the ag chemical downcycle, the $4.07B debt burden, and management's decision to prioritize deleveraging over shareholder returns. The current $0.32/yr dividend costs only ~$40M annually, which is manageable even on depressed FCF. However, further cuts or elimination are possible if the debt situation worsens. The dividend had grown for ~7 consecutive years before the cut. Do not invest in FMC for dividend income — this is a cyclical recovery / deep value thesis.
🔮 Analyst Forecast Section
(a) EPS Consensus
| Year | Low / Actual | Avg | High | # Analysts | Type |
|---|---|---|---|---|---|
| 2021 | $6.26 | — | — | — | Actual |
| 2022 | $6.58 | — | — | — | Actual |
| 2023 | $10.53 | — | — | — | Actual |
| 2024 | $2.72 | — | — | — | Actual |
| 2025 | $-17.88 | — | — | — | Actual |
| 2026 | $1.53 | $1.94 | $2.94 | 21 | Estimate |
| 2027 | $1.81 | $2.41 | $3.57 | 20 | Estimate |
(b) Revenue Consensus
| Year | Low / Actual | Avg | High | # Analysts | Type |
|---|---|---|---|---|---|
| 2021 | $5.0B | — | — | — | Actual |
| 2022 | $5.8B | — | — | — | Actual |
| 2023 | $4.5B | — | — | — | Actual |
| 2024 | $4.2B | — | — | — | Actual |
| 2025 | $3.5B | — | — | — | Actual |
| 2026 | $3.5B | $3.8B | $4.0B | 22 | Estimate |
| 2027 | $3.5B | $3.9B | $4.3B | 22 | Estimate |
(c) Individual Analyst Price Targets
| Analyst | Firm | Rating | PT | Upside |
|---|---|---|---|---|
| Unknown | High Estimate | Buy | $33 | +131.9% |
| Unknown | Median | Hold | $17 | +19.5% |
| Unknown | Low Estimate | Sell | $13 | -8.6% |
💡 Investment Thesis
- Deep Cyclical Value: FMC trades at 8x forward earnings ($1.94 FY2026E) and ~5.8x normalized EV/EBITDA — well below its 5-year average of 12-14x EV/EBITDA. The stock is down 68% from its 52-week high. If the ag cycle turns (which it historically does), significant upside exists from both earnings recovery and multiple expansion.
- IP and Product Pipeline: FMC has one of the strongest patent portfolios in crop protection, with novel active ingredients including diamides (Rynaxypyr/Cyazypyr) and new herbicide platforms (Overwatch). Biologicals are an emerging growth driver. This IP differentiates FMC from pure-generic competitors.
- Global Distribution Network: Presence in 53 countries with deep distributor relationships creates a difficult-to-replicate moat. When destocking reverses to restocking, FMC's channel position drives rapid revenue recovery.
- Key Risk — Debt Load: $4.07B total debt on a $1.78B market cap (2.3x D/E) is the primary risk. Net debt/EBITDA is ~5-6x on normalized earnings. If the cycle recovery is delayed or weaker than expected, debt service becomes untenable. Short-term debt of $1.3B needs refinancing — credit risk is real.
- Key Risk — Generic Competition: Chinese generic manufacturers have flooded markets with below-cost crop protection chemicals, especially in Asia and Latin America. If this structural shift continues, FMC's pricing power may not recover to pre-2023 levels even as volumes improve. Gross margins may permanently reset 3-5pp lower than historical averages.
⚖️ DCF Verdict: Hold — FMC Corporation (FMC)
Current price: $14.23 | Analyst Avg PT: $17.75
$-8
🔴 Bear
$16
📊 Base
$54
🚀 Bull
| Tier | Price | Action |
|---|---|---|
| Tier 1 — Starter | ≤$15 | Begin position |
| Tier 2 — Add | ≤$4 | Add on weakness |
| Tier 3 — Full | ≤$-8 | Full allocation |
| Sell Alert | ≥$46 | Above fair value — consider trimming |
How tiers are set: Tier 1 = Base IV × 0.92 (8% discount to base case). Tier 2 = midpoint of Bear & Base IV (building on meaningful weakness). Tier 3 = Bear IV × 1.05 (just above worst-case — maximum margin of safety). Sell alert = Bull IV × 0.85 (15% discount to bull case — above fair value range).
FMC at $14.23 is a high-risk Hold with a Base DCF target of ~$18. While the 25% upside to our Base IV is attractive, the severe leverage ($3.5B net debt on $1.8B market cap), ongoing ag sector headwinds, and near-term execution uncertainty make this a "show me" story. The stock is a potential deep value opportunity IF the ag cycle turns, but the downside risk from debt restructuring or equity dilution is significant.
The Bear case of ~$5/share reflects genuine credit risk — the $1.3B in short-term debt requires refinancing, and a protracted downcycle could force restructuring. The Bull case of $30+ assumes a strong cyclical recovery and successful deleveraging.
Action: Hold at current levels — wait for evidence of cycle turn (channel restocking, pricing stabilization). Speculative Accumulate below $12 for investors with high risk tolerance. Full position only if FY2026 Q1-Q2 shows volume recovery. Sell if net debt/EBITDA exceeds 7x or if short-term debt refinancing fails.
🔧 Model Notes & Calibration
| Assumption | Rationale / Notes |
|---|---|
| Why DCF (not DDM) | FMC cut its dividend 86% in FY2025. The current $0.32/yr payout is a placeholder — the stock is a cyclical recovery thesis, not an income investment. DCF with normalized FCF is the appropriate methodology for a capital-intensive business in a deep cyclical trough with significant debt. |
| WACC — Distress-Adjusted | CAPM-derived WACC is 5.4% (Ke=7.6%, Kd=4.5%, We=30% Wd=70%) — too low for a company with $4.1B total debt, negative earnings, and an industry in downturn. Adjusted to 8.0% (+2.6% premium) reflecting: (1) near-term refinancing risk on $1.3B short-term debt, (2) execution risk on recovery, (3) structural risk from Chinese generic competition. A 5.4% WACC produces IV of $40+ — divorced from market reality and analyst consensus. |
| FCF Base — Forward-Looking Normalized | FY2025 FCF was -$103M (impairment-distorted). Used $260M normalized estimate based on: FY2026 consensus EPS $1.94 × 125M shares = $243M net income + $185M D&A - $170M capex = ~$258M. Historical FCF margin of 10-16% on $3.5B revenue also supports $260M. Conservative relative to FY2024 FCF of $669M (which benefited from WC release). |
| Net Debt Dominates Valuation | At $3.49B net debt and $1.78B market cap, the debt overhang is the dominant valuation factor. Every $500M reduction in net debt adds ~$4/share to equity value. Deleveraging path — through FCF, asset sales, and potential non-core divestitures — is the key catalyst to monitor. If management can reduce net debt to $2.5B by FY2028, equity value could increase 50%+ from current levels. |
| Impairment Details | FY2025 included ~$2.1B in goodwill and intangible asset impairments, primarily reflecting the writedown of ag chemical franchise values acquired in prior transactions. Goodwill was essentially eliminated from the balance sheet (from $1.5B to near-zero). These are non-cash charges and do not impact FCF or going-concern value, but they reflect management's acknowledgment that the business is worth less than previously assumed. |
Bore Family Office • Analysis generated by Lurch • Not investment advice.