A month has gone by since the last earnings report for Tronox (TROX). Shares have lost about 7.2% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Tronox due for a breakout? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent catalysts for Tronox Holdings PLC before we dive into how investors and analysts have reacted as of late.
Tronox’s Q1 Earnings Miss Estimates, Sales Rise Y/Y On Higher Volumes
Tronox logged a loss (as reported) of 65 cents per share for the first quarter of 2026, wider than a loss of 70 cents reported a year ago.
Barring one-time items, adjusted loss for the reported quarter was 55 cents per share compared with a loss of 15 cents a year ago. It was wider than the Zacks Consensus Estimate of a loss of 48 cents.
The company raked in revenues of $760 million, up around 3% year over year. It beat the Zacks Consensus Estimate of $758.5 million. Higher TiO2 and zircon sales volumes and favorable currency impact more than offset lower average selling price and product mix impact.
Adjusted EBITDA was $62 million, down 45% year over year, with an adjusted EBITDA margin of 8.2%. The downside was due to lower average selling prices, including mix, unfavorable exchange rate movements and higher freight and production costs.
Segment Highlights
TiO2 sales were $616 million in the reported quarter, up 5% year over year. TiO2 volumes rose 5% year over year, while price/mix was down 4%. Currency was 4% favorable.
Zircon sales were $89 million, up 29% year over year. Sales were supported by 57% volumes growth, offset by 28% price/mix decline.
Financials
Cash and equivalents were $126 million as of March 31, 2026. Total debt was $3.3 billion at the end of the year, while net debt was $3.2 billion.
Operating cash used was $68 million for the first quarter, while free cash flow was negative $135 million.
Outlook
Management expects a stronger second quarter with improving demand pricing and cash generation. The company expects free cash flow to turn positive in quarter two and largely offset the cash use in the first quarter while also targeting meaningful positive free cash flow for full-year 2026.
TiO2 volumes are projected to rise sequentially in the high-single-digit percentage range while zircon volumes are expected to moderate slightly from first-quarter levels. Both TiO2 and zircon pricing are expected to improve in the mid-single-digit percentage range due to announced price increases and cost-related surcharges. Supported by stronger pricing and higher TiO2 volumes, Tronox expects adjusted EBITDA of $65 million to $85 million for the second quarter of 2026.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
The consensus estimate has shifted -20.47% due to these changes.
VGM Scores
Currently, Tronox has a poor Growth Score of F, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for value investors.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Tronox has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Tronox Holdings PLC (TROX): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).