Axalta Coating Systems (AXTA) downside risk is nearly priced in, underpinned by resilient performance of its core segments and strong execution from the management, UBS analysts said Monday in a research note.

Axalta Coating's stock is almost pricing in the analysts' downside scenario, which assumes sales declining about 9% below their estimate of 2025 sales growth of 1.1%. The analysts are also forecasting $930M in earnings before interest, taxes, depreciation and amortization, or EBITDA, about 18% below their 2025 EBITDA estimate of $1.14B. This leads to an average enterprise value/EBITDA multiple, of about $33 per share, which is 5% above current trading.

Looking ahead to 2025/26, the analysts assume only new wins and 2% declines in auto production versus flat previously. They also sees less downside potential in industrial and refinish volumes following a period of weakening already.

UBS upgraded Axalta Coating to buy from neutral, but decreased their price target on the stock to $40 from $42.

Price: 29.22, Change: -0.51, Percent Change: -1.72