Stepan (NYSE:SCL) Shares Gap Down on Disappointing Earnings

Stepan Company (NYSE:SCL) shares gapped down before the market opened on Monday after the company announced weaker than expected quarterly earnings. The stock had previously closed at $67.23, but opened at $60.98. Stepan shares last traded at $55.9680, with a volume of 36,093 shares trading hands.

The basic materials company reported ($0.02) EPS for the quarter, missing the consensus estimate of $0.35 by ($0.37). The company had revenue of $553.89 million during the quarter, compared to analyst estimates of $570.60 million. Stepan had a return on equity of 3.38% and a net margin of 2.01%.The business’s revenue was up 5.4% compared to the same quarter last year. During the same quarter in the prior year, the company posted $0.12 earnings per share.

Stepan Dividend Announcement

The company also recently declared a quarterly dividend, which will be paid on Friday, March 13th. Shareholders of record on Monday, March 2nd will be paid a dividend of $0.395 per share. This represents a $1.58 dividend on an annualized basis and a yield of 3.0%. The ex-dividend date is Monday, March 2nd. Stepan’s dividend payout ratio is 79.80%.

Trending Headlines about Stepan

Here are the key news stories impacting Stepan this week:

• Positive Sentiment: Board declared a quarterly cash dividend of $0.395 per share (ex‑dividend March 2; payable March 13), implying a roughly 3.0% yield — supports income investors and signals confidence in cash flow. Stepan Declares Quarterly Dividend
• Positive Sentiment: Management launched “Project Catalyst,” a two‑year operational program targeting approximately $100 million in pre‑tax savings to improve margins and drive EBITDA growth — a material initiative that can meaningfully restore profitability if execution succeeds. Project Catalyst Announcement
• Positive Sentiment: Company reiterated expectations for EBITDA growth in 2026 tied to restructuring and the cost‑out plan; management emphasized margin recovery in the earnings call. This guidance provides a near‑term operational catalyst if targets are met. Stepan Outlines $100M Cost Savings Plan
• Neutral Sentiment: Reported GAAP net income of $5.0M for the quarter (up ~49% year‑over‑year), which partially offsets concerns from the EPS miss but warrants scrutiny on one‑time items and margins. Q4 and Full Year 2025 Results
• Neutral Sentiment: Earnings materials (call transcript and slide deck) are available for investors to review management’s details on restructuring assumptions and timeline — useful for modeling but not an immediate price driver by itself. Earnings Call Transcript
• Neutral Sentiment: Coverage pieces noting Stepan among long‑running dividend raisers may attract yield‑focused investors over time, but this is a gradual support rather than an immediate catalyst. Dividend Kings Article
• Negative Sentiment: Reported EPS of ($0.02) missed consensus (~$0.35) and revenue of $553.9M missed estimates (~$570.6M), a headline miss that pressured near‑term sentiment and valuation multiples. Q4 Loss and Revenue Miss
• Negative Sentiment: Market reaction has been negative intraday as investors weigh the earnings miss and execution risk on the $100M cost‑out target; near‑term volatility likely until the company provides concrete progress updates. Market Trading Snapshot

Analyst Upgrades and Downgrades

Separately, Weiss Ratings upgraded Stepan from a “sell (d+)” rating to a “hold (c-)” rating in a report on Wednesday, February 18th. Two analysts have rated the stock with a Hold rating, According to MarketBeat, the company has an average rating of “Hold”.

Institutional Trading of Stepan

Hedge funds have recently modified their holdings of the stock. 1620 Investment Advisors Inc. boosted its holdings in Stepan by 86.9% in the fourth quarter. 1620 Investment Advisors Inc. now owns 570 shares of the basic materials company’s stock valued at $27,000 after purchasing an additional 265 shares during the period. EverSource Wealth Advisors LLC raised its position in Stepan by 206.5% in the 2nd quarter. EverSource Wealth Advisors LLC now owns 521 shares of the basic materials company’s stock valued at $28,000 after purchasing an additional 351 shares in the last quarter. Financial Consulate Inc. purchased a new position in shares of Stepan in the 3rd quarter valued at about $30,000. Parallel Advisors LLC boosted its stake in shares of Stepan by 700.0% in the 4th quarter. Parallel Advisors LLC now owns 688 shares of the basic materials company’s stock valued at $33,000 after buying an additional 602 shares during the period. Finally, Quarry LP acquired a new position in shares of Stepan during the third quarter worth about $34,000. 82.70% of the stock is currently owned by institutional investors and hedge funds.

Stepan Price Performance

The stock’s 50 day moving average is $54.90 and its two-hundred day moving average is $49.77. The stock has a market capitalization of $1.19 billion, a PE ratio of 25.61 and a beta of 1.05. The company has a debt-to-equity ratio of 0.27, a current ratio of 1.29 and a quick ratio of 0.84.

About Stepan

Stepan Company is a global manufacturer of specialty and intermediate chemicals, primarily known for its development and production of surfactants and related specialty products. The company’s portfolio includes a wide range of ingredients used to enhance the performance of consumer and industrial formulations, such as emulsifiers, foam control agents, odor control agents, antimicrobial products and performance additives. These products are integral components in cleaning solutions, personal care items, agrochemical formulations, coatings, oilfield treatments and polymer systems.

Serving a diverse set of end-markets, Stepan’s offerings address both consumer-facing and industrial applications.