Solstice Advanced Materials, Inc. (NASDAQ:SOLS) is one of the stocks Jim Cramer mentioned in his latest comments. Cramer mentioned the stock during the episode and said: “Again, you only need to get rich once. If you want a safer way to go in nuclear, by the way, I like this processing division of Solstice, the Honeywell spin-off, which has a full order book. That’s a cheap stock.” A person with stock market data on a laptop. Photo by Anna Nekrashevich on Pexels Solstice Advanced Materials, Inc. (NASD ...

Core Insights - Solstice Advanced Materials Inc. reported a net sales increase of 7% year-over-year for Q3 2025, reaching $969 million, driven by strong demand in Refrigerants and Electronic Materials [2][10][11] - The company experienced a net loss of $35 million in Q3 2025, a significant decline from a net income of $152 million in Q3 2024, largely due to higher tax expenses related to its spin-off from Honeywell [3][10] - Adjusted Standalone EBITDA for Q3 2025 was estimated at $235 million, down 5% from the previous year, with an Adjusted Standalone EBITDA margin of 24.3%, a decrease of 290 basis points [3][10] Financial Performance - Net Sales for Q3 2025 were $969 million, up from $907 million in Q3 2024, with Refrigerants & Applied Solutions segment sales increasing by 9% to $687 million [7][10] - The Refrigerants segment saw a 22% increase in sales, while Healthcare Packaging experienced a 14% decline [7][8] - Adjusted Standalone EBITDA margin decreased to 24.3% from 27.1% in Q3 2024, primarily due to unfavorable product mix and transitory costs [3][10] Segment Highlights - Refrigerants & Applied Solutions segment net sales were $687 million, with Refrigerants contributing $400 million, a 22% increase [7][10] - Electronic & Specialty Materials segment net sales rose 2% to $282 million, driven by a 6% increase in Safety & Defense Solutions and a 4% increase in Electronic Materials [9][11] - Adjusted EBITDA for the Refrigerants & Applied Solutions segment decreased by 3%, while the Electronic & Specialty Materials segment saw a 15% decline in Adjusted EBITDA [8][12] Capital Expenditures and Financial Position - Capital expenditures for the first nine months of 2025 were $248 million, a 23% increase compared to the prior year, aimed at long-term growth [4][5] - As of the spin-off, total long-term debt was $2.0 billion, with cash and cash equivalents around $450 million, resulting in a net leverage ratio of approximately 1.5x [6][10] 2025 Financial Outlook - The company reaffirmed its full-year 2025 guidance, expecting net sales between $3.75 billion and $3.85 billion, with an estimated Adjusted Standalone EBITDA margin of around 25% [10][21]

Joining me now here on set in [music] an exclusive interview is David Sul, CEO of Solstice Advanced Materials. David, welcome. Um, defense, chips, and nuclear.Why should I believe that these pretty hot areas are are spaces where you can grow. >> Well, John, first off, thanks for having us. It's it's a great day to go public on on our own from Honeywell, but these are really the inflection point of some great grow uh growth trends.uh nuclear power expected to grow three to 400% over the next 25 years. Solsti ...

Core Insights - Warren Buffett will step down as CEO of Berkshire Hathaway on January 1, 2026, while remaining as chairman, with Greg Abel set to succeed him [1] - Buffett executed a $9.7 billion deal to acquire OxyChem from Occidental Petroleum shortly before the leadership transition [1][2] Company Background - Berkshire Hathaway has a long-standing relationship with Occidental Petroleum, having provided a $10 billion loan in 2019 for its acquisition of Anadarko Petroleum [4] - Berkshire has been increasing its stake in Occidental, currently owning 26.9% of the company, valued at approximately $11.7 billion [5][6] Acquisition Details - The $9.7 billion purchase price for OxyChem is significant compared to Occidental's market cap of $43.6 billion [6] - OxyChem is involved in producing chemicals for various applications, including chlorine and polyvinyl chloride, and plays a role in Occidental's carbon capture initiatives [7] Strategic Implications - The acquisition aligns with Berkshire Hathaway's investment strategy, focusing on underappreciated businesses rather than high-growth stocks [8] - The sale of OxyChem is not expected to hinder Occidental's low-carbon goals but indicates a shift towards projects that generate immediate free cash flow [9]

Core Insights - Honeywell International Inc.'s business unit, Solstice Advanced Materials Inc., has priced a $1 billion offering of senior notes with a 5.625% interest rate, maturing on September 30, 2033 [1][7] - The funds raised will be used to pay Honeywell for the spin-off and cover related fees and expenses, with remaining funds allocated for general corporate purposes [3][7] - An escrow arrangement will hold the proceeds until the spin-off conditions are met, with a redemption clause if conditions are not fulfilled by March 31, 2026 [4][7] Spin-Off Details - Honeywell announced its intention to spin off its advanced materials business in October 2024, creating an independent company named Solstice Advanced Materials, based in Morris Plains, NJ [5] - The new company will focus on protective fibers, semiconductor materials, refrigerants, and healthcare packaging, operating in two segments: Refrigerants & Applied Solutions and Electronic & Specialty Materials [5] Financial Performance - Honeywell's shares have increased by 4.6% over the past year, outperforming the industry growth of 0.1% [6] - The company is experiencing strength in its defense business and growth in air transport flight hours, alongside solid demand for building products [6] Challenges - There is a noted weakness in the Industrial Automation segment due to lower demand for projects, raising concerns about productivity solutions and services [9]

Core Viewpoint - Honeywell announced the future Board of Directors for Solstice Advanced Materials, a specialty materials company set to spin off from Honeywell, focusing on key markets such as refrigerants, semiconductor materials, protective fibers, and healthcare packaging solutions [1][3]. Group 1: Board Composition - Dr. Rajeev Gautam will serve as Independent Chair of the Board, bringing over 40 years of experience at Honeywell [2][5]. - David Sewell, President and CEO of Solstice Advanced Materials, has over 30 years of experience in the materials and chemicals industries [2][5]. - The Board will include leaders with extensive backgrounds in industrial, technology, chemicals, and materials sectors, ensuring a diverse and experienced leadership team [2][4]. Group 2: Strategic Vision and Goals - The Board is expected to provide cross-sector insights and leadership to drive growth and enhance customer relationships from the outset [3]. - Solstice aims to enter its new phase with strong momentum, a clear strategic vision, and a commitment to innovation and operational excellence [3][4]. - The spin-off is on track for completion in the fourth quarter of 2025, positioning Solstice for immediate impact in its target markets [4][5].

Group 1 - The article expresses a beneficial long position in the shares of CC and BASFY, indicating a positive outlook on these companies [1] - The author emphasizes the importance of conducting due diligence and research prior to any investment, highlighting the risks associated with short-term trading and options trading [2] - It is noted that past performance is not indicative of future results, and no specific investment recommendations are provided [3]

Financial Data and Key Metrics Changes - Company reported revenue of $55.3 million for Q1 2025, a 15% decrease compared to the same period in 2024, primarily due to lower refrigerant market prices offsetting sales volume gains [19][20] - Gross margin decreased to 22% from 33% year-over-year, attributed to low refrigerant market prices [20] - Operating income fell to $3.1 million, a decrease of $9.7 million compared to $12.8 million in Q1 2024 [20] - Net income was $2.8 million or $0.06 per diluted share, down from $9.6 million or $0.20 per diluted share in the previous year [21] Business Line Data and Key Metrics Changes - The reclamation business saw increased reclaim volume during the first quarter, supported by the strategic acquisition of USA Refrigerants [6] - Revenue from the DLA contract remained consistent with a historical mid $30 million annualized run rate [19] Market Data and Key Metrics Changes - Refrigerant pricing was approximately 40% lower than the previous year's first quarter, with certain HFC prices still under $6 per pound at the close of Q1 [5][7] - The demand for new lower GWP refrigerants is currently exceeding production volumes, with expectations for production to balance out with demand by the latter part of the cooling season [10] Company Strategy and Development Direction - Company is focused on improving purchasing presence in the marketplace and enhancing reclamation capabilities [6] - The capital allocation strategy emphasizes organic growth, strategic acquisitions, and opportunistic stock repurchases [11][21] - The transition to lower GWP refrigerants presents a long-term growth opportunity for the reclamation business as the supply of virgin HFCs declines [15] Management's Comments on Operating Environment and Future Outlook - Management noted the current microeconomic environment is volatile, with tariff costs affecting supply side costs for both virgin refrigerants and cylinders [8][9] - There is optimism regarding the industry's transition to lower GWP refrigerants, which is expected to create substantial long-term growth opportunities [24] Other Important Information - The company ended the quarter with $81 million in cash and no debt, indicating a strong unlevered balance sheet [11][21] - The company has repurchased a total of $4.5 million of common stock under its buyback plan in 2025 [11][21] Q&A Session Summary Question: What is driving the recent price stability and increases? - Management indicated that supply chain disruptions and tariffs have contributed to higher prices, but the permanence of these price changes will be clearer as the cooling season progresses [28][30] Question: How does the cylinder shortage impact Hudson's competitive positioning? - Management acknowledged that while Hudson has advantages with reusable cylinders, supply disruptions are occurring due to longer lead times for valve manufacturing and increased demand for disposable cylinders [31][32] Question: Is there any benefit to reclamation from current macroeconomic conditions? - Management reported an increase in reclaimed volumes in Q1 and expects continued growth in reclamation due to educational efforts and partnerships with customers [34] Question: How have imports of refrigerants through Mexico been affected by tariffs? - Management noted that while there is limited production capacity in Mexico, the overall market is more impacted by tariffs on imports from India and China [38][39] Question: What are the capital allocation plans for stock buybacks? - Management confirmed that they will continue to proceed opportunistically with the remaining $5.2 million allocated for buybacks [47] Question: How is inventory trending for the rest of the year? - Management believes they are approaching normalized inventory levels [48]

Financial Data and Key Metrics Changes - The company reported a flat net sales for the second quarter, while organic revenue increased by 1.4%, marking the fourth consecutive quarter of organic growth [12][7] - Adjusted earnings per share (EPS) reached $0.67, at the upper end of the guidance range [7][14] - Adjusted gross margin increased by 30 basis points to 40.8%, driven by project momentum savings [13] - Free cash flow declined by $44.1 million year over year, primarily due to investments in inventory and capital expenditures [14][15] Business Line Data and Key Metrics Changes - The battery business experienced a strong performance with 3% organic growth, benefiting from distribution wins in the U.S. and strong international results [9][12] - Auto care saw strong growth in appearance and air freshener segments, with the appearance business delivering 5.5% organic growth, driven by the new Podium Series product line [10][12] - Overall, the auto business declined approximately 2.5% organically, attributed to a shift in refrigerant shipment timing [10][12] Market Data and Key Metrics Changes - The battery category is expected to deliver low single-digit growth over the long term, although weakened consumer confidence may pressure volumes in the short term [23] - In auto care, consumer caution is anticipated to have mixed impacts, with some consumers shifting to DIY categories while others prioritize spending in less discretionary categories [23] Company Strategy and Development Direction - The company is focused on distribution, innovation, digital commerce, pricing and revenue management, and market expansion to drive growth [8] - Strategic acquisitions have been made to enhance manufacturing capabilities and improve supply chain resilience [20] - The company aims to reduce exposure to tariffs through sourcing shifts and pricing adjustments [25][28] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by tariffs and changing consumer sentiment, emphasizing the need to stay close to consumers [18][23] - The outlook for the remainder of the year has been tempered due to anticipated consumer pullback and inflationary pressures [24][30] - The company expects reported and organic net sales for the full year to be flat to up 2%, with adjusted EBITDA and EPS reflecting positive growth [30][31] Other Important Information - The company refinanced its $500 million revolving credit facility, extending maturities and improving debt portfolio flexibility [14] - The recent acquisition of APS in Europe is expected to enhance scale and manufacturing capabilities in key markets [69] Q&A Session Summary Question: Follow-up on tariff commentary and mitigation impacts - Management clarified that they have mitigated the impact of tariffs for fiscal year 2025 and are working on strategies to address future exposures [36][39] Question: Evaluation of devices using batteries and impact on forecasts - Management acknowledged that higher prices for devices could lead to consumer pullback, impacting battery replenishment cycles [50][53] Question: Retailer destocking and its impact - Management noted a slight uptick in retailer inventory due to softer sales, which is expected to normalize over time [65][66] Question: Details on the APS acquisition - The acquisition is expected to enhance the company's manufacturing capabilities and will involve transitioning from Panasonic to Energizer branding [69] Question: Long-term leverage target - The company aims to reduce leverage to below four times, with debt paydown being a top priority [108]