UMICY stock is a global materials technology and recycling company based in Belgium. The firm’s core business is circular material technology, using its expertise in material science, chemistry, and metallurgy.  

If you are actively investing in stocks and commodities this stock may be of interest as it operates in a growing sector. The company supplies and recycles specialty materials and many of its customers are in the electric vehicle industry. 

Given the expected growth of the industry in the near future, there may also be good growth prospects for UMICY stock. This stock is also a play on commodities as it operates with lithium, gold, silver, and molybdenum among many other rare materials.

Umicore performance
Source: TradingView

UMICY Stock: Company Summary

The company states its mission is to develop, produce, and recycle materials for a “Better life”. Their mission involves applying circular economy to the production and recycling of materials. Umicore has 11,050 employees and 46 production sites around the world.

UMICY stock is committed to providing sustainable and environmentally friendly solutions. They are at the forefront of circularity which greatly improves the sustainability within the growing need for specialty materials in a fast-changing world.

The company was founded in 1805 as Minière du Haut Katanga and changed its name to Umicore SA in 2001. More specifically the company operates in the following segments:

Catalyst Segment

  • Automotive Catalysts for gasoline, and light and heavy diesel applications. 
  • Stationary Catalysts for industrial emissions controls and use in pharmaceutical and fine chemical industries, and fuel cell applications.

Energy Technologies Segment 

  • Cobalt and specialty materials 
  • Rechargeable batteries materials
  • Electro-optic materials
  • Electroplating and PVD coating

Recycling Segment

  • Treatment of waste streams from the precious metals and other specialty metals industries end-of-life materials.
  • Production of precious metals-based materials for manufacturing glass, electrics, and electronic applications.

UMICY In the News

Let’s have a look at the latest headlines for UMICY stock in the recent past. Umicore has been in the news a lot during 2022 and has had various pieces of good news to share. The amount of news for the firm indicates how proactive the company’s management is.

Strategic Partnerships

 On September 26, 2022, the company announced a joint venture with PowerCo to produce battery materials.

PowerCo is owned by the Volkswagen Group and the joint venture will aim to create a large-scale supply chain for sustainable batteries. The two companies will invest €3 billion ($2.95 billion) to produce battery materials for 2.2 million electric vehicles by 2030.

Umicore inaugurated Europe’s first battery materials gigafactory on September 21, 2022, in Poland. The factory is Europe’s first for the production of cathode active materials for electric vehicles. The facility has a zero-carbon footprint and will supply the company’s clients in Europe.

As part of its goal to maintain a sustainable operation, Umicore announced on September 15, 2022, that it had signed two separate power purchase agreements with Statkraft and Gasum. The agreements will guarantee Umicore green energy for ten years from wind turbines in Finland.

The two agreements will power the plant Umicore owns in Kokkola, Finland. This factory makes precursor cathode active materials and refines cobalt used in rechargeable batteries for electric cars. 

New Production Plans

On July 13, 2022, Umicore announced plans to build a facility for the production of cathode active battery materials and precursor materials in Ontario, Canada. The factory would be the first of its kind in North America and would complete the supply chain in Canada for the transition to electric mobility.

Umicore is planning to build a large-scale fuel cell catalyst plant in China, the announcement came on July 7, 2022. The plant would enable UMCIY stock to seize the opportunity in the fast-growing hydrogen fuel cell mobility industry.

UMICY Stock Profile

  • Market Capitalization: $7.81 billion
  • Price Earnings Ratio (TTM): 15.11
  • Dividend Yield: 2.52%
  • Average Daily Volume: 140,973 shares
  • 52-Week Range: $6.95 – $14.67
  • Gross Profits: 2 years consecutive increases

UMICY Stock: Fundamental Analysis

Let’s look at some numbers on the financial side for UMICY stock and an analysis of the fundamentals for the sectors Umicore operates in.

Umicore Fundamentals

The company is well-financed and has a low debt-to-asset ratio of 0.65, which would indicate a high level of solvency. The gross profits have been on the rise for the past two years consecutively. As we can see from the table below gross profits rose from €1.448 billion in 2018 to €1.987 billion in 2021.

Umicore Income Statement
Source: YahooFinance

The TTM price-earnings ratio of the S&P 500 was 19.81 at the time of writing, while the TTM price-earnings ratio of UMICY stock is 15.11. So, when measured against the broad stock markets Umicore doesn’t seem to be overpriced. 

Of course, the price-earnings ratios of UMICY would need to be measured against the price-earnings ratios of its peers. Also, a thorough analysis of the financials of UMCIY would be needed, unfortunately, both are beyond the scope of this article.

Industry Fundamentals

To get an idea of what the future may hold for UMICY stock you should also look at the developments in the industry this company caters to. Recent reports show that the electric vehicle and associated by-industries are set to grow exponentially over the next few years.

A report by Prophecy Market Insights states that the electric vehicle battery recycling industry is worth $1.93 billion in 2022. And that the sector is expected to achieve a CAGR of 31.8 percent and reach a value of $30.5 billion by 2032. 

The cobalt market value is expected to reach $19.47 billion by 2030, according to Straits Research. They see the cobalt market with a value of $8.7 billion in 2021, growing at a CAGR of 9.3 percent from 2022 to 2030.

The hydrogen industry is set to achieve a high growth rate in the coming years, especially in Europe. Goldman Sachs estimates the hydrogen fuel cell market could eventually grow into a $1 trillion a year market. 

UMICY Stock: Technical Analysis

Looking at some technical analysis of UNICY stock is always necessary to understand the overall general trend. From the weekly chart below, we can see that the price of UMICY stock hit an all-time high in August 2021, at $17.71. 

From there it has seen consistently lower lows and lower highs denoting a clear bear trend. Much of the stock’s fate has been in the hands of the broader stock market. However, the S&P 500 is down 17.18 percent since August 21, 2021. While UMICY stock is 34.79 percent from its record high.

The 50-day moving average crossed below the 200-day moving average in July 2022. And price action has been below both the 200-day moving average since November 2021. The indication from this setup is that the medium-term trend is still bearish.

UMICY Stock
Source: TradingView

Short-term Trend

Looking at the short-term view for this stock we can consider the day chart below. The 50-day moving average has been below the 200-day moving average throughout the year. However, UMICY stock price has managed to trend higher from its recent low. 

On October 21, 2022, price action moved above the 50-day moving average and has managed to stay above it at the time of writing. This momentum may indicate there are further highs to be reached. 

That said, price action will find some resistance at the 200-day moving average level. While for a clear short-term bullish indication we would need to see the stock’s price rise above the 200-day moving average. For further confirmation, the 50-day moving average would also need to cross above the 200-day moving average.

UMICY Stock daily chart
Source: TradingView

UMICY Stock: Conclusion

When choosing a stock, it’s necessary to pay a lot of attention to the future prospects for the industry it serves as a whole. The sustainable mobility narrative is gaining traction in a lot of countries around the world.

If the trend continues the recycling and materials businesses are likely to benefit from the expansion. However, a lot remains to be seen as to how these markets develop. Electricity is becoming increasingly expensive, so the expansion to electric vehicles may see limitations at some point.

However, Umicore is heavily involved in hydrogen fuel cell material production. This may be a future sector within sustainable mobility that doesn’t feel the negative effects of high energy costs. 

Bottom Line

We always suggest creating a very diversified portfolio, with a wide range of alternative investments. Assets such as precious metals, real estate, and hedge funds offer returns that are not highly correlated to the stock market. This feature helps decrease the overall risk of your portfolio.

However, picking stocks or investing for the long term is a tough job. There are so many stocks out there and there is so much information. The totality of both can be overwhelming. However, several top companies offer their expertise when it comes to investing, you can read our reviews about them here.

Gino D'Alessio

Gino D'Alessio is a Broker/Dealer with over twenty years experience in various OTC markets such as Bonds, FX and Derivatives. Currently a Financial Markets and Investments Writer & Analyst