Quality Investor

Cabot Corporation

Rank #301Value

CBT · NYSE · Basic Materials

Cabot Corporation (CBT) — Rank #301 by gross profitability (GP/assets 0.24) · ROE 20.6% · Piotroski F-Score 6 / 9.

As-of 2026-09-15 · CIK 0000016040 · all metrics point-in-time as of the filing date.

About

Cabot Corporation operates as a specialty chemicals and performance materials company.

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It operates through two segments, Reinforcement Materials and Performance Chemicals. The company offers reinforcing carbons that are used in tires as a rubber reinforcing agent and performance additive, as well as in industrial products, such as hoses, belts, extruded profiles, and molded goods; and engineered elastomer composites solutions. It also provides specialty carbons for use in inks, coatings, plastics, adhesives, toners, batteries, and displays; conductive additives and fumed alumina used in lead acid and lithium-ion batteries for electric vehicles; fumed silica used in adhesives, sealants, cosmetics, batteries, inks, toners, silicone elastomers, coatings, polishing slurries, and pharmaceuticals; and fumed alumina for use in various products, including inkjet media, lighting, coatings, cosmetics, and polishing slurries. In addition, it offers aerogel, a hydrophobic, silica-based particle to use in various thermal insulation and specialty chemical applications; masterbatch and conductive compound products that are used in automotive, industrial, packaging, infrastructure, agriculture, consumer products, and electronics industries; and inkjet colorants for inkjet printing applications, as well as carbon nanotubes and fumed metal oxides. The company sells its products through distributors and sales representatives in the Americas, Europe, the Middle East, Africa, and the Asia Pacific.

Cabot Corporation was founded in 1882 and is headquartered in Boston, Massachusetts.

Industry
Specialty Chemicals
Sector
Basic Materials
State
DE
Filer Category
Large accelerated filer
Fiscal Year End
September 30

Price History

CBT+68.3% · +11.0% CAGRSPY+80.5% · +12.5% CAGR

Company Snapshot

P/E and dividend yield are the primary valuation lenses for mature businesses.

Market Cap

$4.12B

P/E (annual)

13.3

P/S (annual)

1.1

P/B

2.6

P/OCF (annual)

6.2

Shareholder Yield

5.0%

Employees

4,064

Industry

Specialty Chemicals

Exchange

NYSE

Signal Flags

2 green1 red
Operating leverage expandingOperating income growing faster than revenue
Sequential beat (rev + EPS)Both revenue and EPS exceeded prior quarter — 3-quarter streak
Revenue declining YoYRevenue contracted year over year

Quality Profile

Profitability

1/1 pass
GP / assets
0.24
Return on equity
20.6%
Gross margin trend
PASS

Safety

1/1 pass
Balance-sheet safety
PASS
Debt / equity
1.29
Current ratio
1.47×
Net cash
-$1.02B

Cash Flow

3/3 pass
Positive FCF
PASS
Cash-backed earnings
PASS
Accruals healthy
PASS
SBC / revenue
0.6%

Growth

1/2 pass
Revenue growth
-7.0%
Piotroski F-Score
6 / 9
Share dilution
-2.7%

Terry Smith quality gate

Passes 2/5 Terry Smith thresholds

What Growth Is Priced In

Implied revenue growth (10Y)

-0.4%

incredible deal

The annual FCF growth rate today's price requires over a 10-year horizon (discount rate 10%, terminal growth 2.5%).

Buyback tailwind: -2.7% — per-share value needs a total required return of -3.1% once share-count change is priced in.

vs. own 6-year median revenue growth: -2.7%

Cost-of-equity sensitivity (implied growth at different discount rates)

r = 8%

-4.2%

r = 10% (base)

-0.4%

r = 12%

2.9%

Net debt / market cap: 23.6%

Base FCF: $391M3Y mean FCF: $397.7M

Valuation History

Current multiple vs historical range at each filing date. Band spans 25th-75th percentile.

P / E

Price / diluted EPS

10.3xCheap
10.0xmed 16.0x21.8x

P / S

Price / revenue per share

0.9xCheap
0.8xmed 1.0x1.5x

P / B

Price / book value per share

2.2xCheap
2.2xmed 3.0x4.7x

P / GP

Price / gross profit per share

3.6xCheap
3.6xmed 4.8x6.2x

P / FCF

Price / free cash flow per share

8.6xCheap
8.6xmed 13.9x49.8x

Dividend yield and payout ratio are the primary reads at this stage (trailing P/E — see valuation above).

Profitability

Gross profitability (GP / assets)

0.24

Primary signal (Novy-Marx).

58th pctl of 34 SIC 28 peers

Return on equity

20.6%

Gross margin

25.3%

18th pctl of 34 SIC 28 peers

Revenue growth (YoY)

-7.0%

Gross margin improving

Margin trend vs prior year.

PASS

Operating Leverage

2022202320242025
Revenue vs COGS
Revenue vs OpEx
Op. Income vs Revenue

Growth

Revenue CAGR (3Y)

-4.9%

Revenue CAGR (5Y)

7.3%

Earnings CAGR (3Y)

16.6%

FCF CAGR (3Y)

Anti-fragile safety

Balance-sheet safety

Composite anti-fragile check.

PASS

Debt / equity

1.29

23rd pctl of 31 SIC 28 peers (best = lowest)

Current ratio

1.47×

12th pctl of 34 SIC 28 peers

Quick ratio

Net cash

-$1.02B

Cash & equivalents minus total debt.

Recession resistance

Revenue through recessions

Worst single-year YoY revenue decline, 17 years of history

Weak
2008-2009 (GFC)
N/AN/A
2020 (COVID)
-21.7%Significant decline
Worst year on record(any fiscal year, not recession-limited)
-21.7%Significant decline

Cash-flow health

Free cash flow

$391.00M

Operating cash flow minus capex.

Positive free cash flow

PASS

FCF / net income

0.18

Cash-backing of earnings.

FCF/NI divergence

Unfavorable divergence (yellow flag).

PASS

Accruals healthy

Cash-backed earnings.

PASS

SBC / revenue

0.6%

Stock-based comp intensity.

Dividend safety

Composite score

3.8 / 5

Good
Payout ratio
29.0%5/5 Strong
FCF coverage
4.07×5/5 Strong
Dividend growth streak
4 yr2/5 Fair
Balance-sheet health
D/E 1.29 · IC 8.17×3/5 Good

Piotroski F-Score

F-Score

6 / 9

Fundamental-strength score (0-9).

Lifecycle Phase History

20202025
Decline
Hypergrowth
Op. Leverage
Value