Barron's: Innospec boasts record free cash, reliable revenue, diversification

|About: Innospec Inc. (IOSP)|By:, SA News Editor

Innospec (IOSP +1.3%) is higher after Barron's profiles the specialty chemical company as oversold after investors have dumped shares thanks to guilt by association with the energy industry.

IOSP's oilfield services business accounts for just 25% of sales, so while energy’s downturn has hurt results, the company is not dependent on its recovery; fuel additives make up 55% of revenue, and the segment continues to perform well.

Even though IOSP had a down Q4, it still finished 2015 with record cash on the books, 3x its cash in Q4 2014; "to have a tough quarter like that and still generate gobs of cash shows the resilience of the business model," says David Bechtel of Barrow Street Advisors.

Now read Innospec muddling through better than most

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