Is IOSP a high-quality business?

AlphaMadera's AlphaQuality grade scores Innospec Inc. on six pillars — profitability, capital efficiency, balance-sheet strength, growth durability, cash generation, and shareholder yield. The composite letter grade reflects how IOSP compares to a Buffett-style quality bar.

What is Innospec Inc.'s AlphaQuality grade?

AlphaQuality assigns a letter grade (A through F) to IOSP based on a six-pillar quantitative model. The live page shows the composite grade plus each pillar's individual score with the underlying metrics.

What makes IOSP a quality stock?

AlphaQuality looks at return on capital, free-cash-flow margins, debt-to-equity, revenue stability, dividend and buyback policy, and operating-margin trend. Stocks scoring well across all six pillars earn higher grades — the methodology favors compounders over cyclicals.

IOSP - Innospec Inc.

Price: -- -- | CONSENSUS: Hold DETAILS | PRICE TARGET: $115.00 DETAILS

AlphaQuality

Quantitative six-pillar business-quality grade

Platform & Compounding FCF

AlphaQuality — archetype-weighted quantitative grade

B- 62.3 / 100 composite

Composite Grade

Composite of six pillars weighted for platform & compounding fcf businesses. Purely quantitative — no stock price or analyst input.

Profitability

Weight: 25%

C+ 57.4

5yr Avg ROIC 9.7% 59/100
Operating Margin Trend -0.01 pp/yr 54/100

Capital Efficiency

Weight: 15%

C 53.6

5yr Avg ROE 7.8% 49/100
5yr Share-Count CAGR 0.1% 62/100

Growth Quality

Weight: 25%

C 54.1

5yr Revenue CAGR 4.6% 57/100
5yr EPS CAGR 5.6% 58/100
Revenue-Growth Years (5) 2/5 40/100

Cash Generation

Weight: 20%

B 70.2

5yr FCF Margin 5.2% 51/100
5yr FCF/NI Conversion 1.34x 94/100

Balance Sheet

Weight: 10%

A+ 100.0

Net Debt / EBITDA -0.99x 100/100
Interest Coverage (EBIT/Int) 30.00x 100/100
Altman Z-Score 5.03 100/100

Stability

Weight: 5%

C- 49.2

EPS Volatility (σ/μ) 0.40 43/100
Piotroski F-Score 6 67/100
Negative-Revenue Years (5) 3/5 40/100

4 of 4 gurus held; 2 new buys; 1 added; 1 trimmed.

Holders: 4 +2
Avg Δ position: +33.3%
New buys: 2
Full exits: 0

Dalio new
Greenblatt new
Wood increased +74%

How this is calculated

AlphaQuality grades six pillars from 0-100 and weights each by archetype:

Profitability (25%) — 5yr Avg ROIC, Operating Margin Trend
Capital Efficiency (15%) — 5yr Avg ROE, 5yr Share-Count CAGR
Growth Quality (25%) — 5yr Revenue CAGR, 5yr EPS CAGR, Revenue-Growth Years (5)
Cash Generation (20%) — 5yr FCF Margin, 5yr FCF/NI Conversion
Balance Sheet (10%) — Net Debt / EBITDA, Interest Coverage (EBIT/Int), Altman Z-Score
Stability (5%) — EPS Volatility (σ/μ), Piotroski F-Score, Negative-Revenue Years (5)

We deliberately ignore stock price, analyst targets, and consensus ratings so the grade is suitable for backtesting forward returns. A minimum of 5 fiscal years of audited statements is required; distressed and highly leveraged infrastructure businesses are declared ungradable rather than forced into a numeric score.