KeyBanc Capital Markets has left its Sector Weight rating intact on Axalta Coating Systems (NYSE:AXTA), pointing to ongoing softness in the refinish market as a primary reason for a cautious posture. Axalta, which carries a market capitalization of $7.35 billion, is trading below InvestingPro's Fair Value estimate, a gap that the research firm notes could imply upside potential despite current market headwinds.
In its assessment, KeyBanc highlighted that Axalta's fourth-quarter results fell short of expectations. The shortfall was attributed largely to destocking within the refinish segment and a weaker showing in industrial coatings. Supporting data from InvestingPro shows that Axalta's revenue has declined by 3.01% over the past twelve months, while EBITDA stood at $1.03 billion for the same period.
The research note also points out that five analysts have trimmed their earnings forecasts for Axalta heading into the upcoming reporting period. Despite those downgrades, KeyBanc described management's EBITDA outlook as achievable: management expects mid-single-digit percentage declines in EBITDA during the first half of the year, followed by high-single-digit percentage growth in the second half, contingent on a modest recovery in demand.
Investor attention remains focused on Axalta's proposed merger with Akzo Nobel. According to the report, discussion among investors continues to revolve around the deal, which is projected to close in late 2026 or early 2027. KeyBanc's decision to keep a Sector Weight rating reflects, in part, what it described as a "more cautious stance on refinish, and autos more broadly" in its research commentary.
Axalta's reported fourth-quarter 2025 results included a small miss on both earnings per share and revenue relative to forecasts. The company's EPS was $0.59, slightly under the forecasted $0.6024, while revenue measured $1.26 billion versus an expected $1.27 billion. These variances amounted to a modest deviation from analyst expectations.
Despite the quarterly miss, the stock showed resilience in pre-market trading, and the note observed that analysts and investors continue to express confidence in Axalta's strategic direction and long-term outlook. The Q4 report, KeyBanc wrote, underscores the mix of challenges and opportunities the company faces amid current market conditions.
Contextual summary
This review by KeyBanc emphasizes short-term demand pressures in refinish and industrial coatings while acknowledging management's pathway to recovery in EBITDA later in the year. The pending merger with Akzo Nobel remains a central theme for stakeholders and could influence market sentiment through the projected closing window of late 2026 to early 2027.