Updated 3/13/25
RPM International plays an essential role in the spaces we live and work in. The business has carved out a solid niche for itself in specialty coatings, sealants, and construction materials. It serves a mix of industrial, commercial, and consumer markets through a wide portfolio of well-known brands. You’ve likely come across their products, even if you didn’t know it.
For income-focused investors, RPM offers a unique value proposition: a commitment to dividend growth, financial discipline, and a track record of navigating through economic ups and downs with minimal drama. It’s a stock that quietly goes about its business—one dividend at a time.
Recent Events
RPM’s latest quarterly update (as of November 2024) paints the picture of a company that’s not only holding steady but improving where it counts. Revenue increased 3% year-over-year, which, in today’s economic environment, is nothing to scoff at. More importantly, earnings per share saw a meaningful boost—up nearly 26%. That kind of earnings growth reflects improved operational efficiency and better cost management.
Margins are trending in the right direction, with operating margin reaching 12.7%. The company reported $650 million in net income over the past 12 months, which gives it a strong footing to continue funding its dividend.
There haven’t been any dramatic shakeups, acquisitions, or headline-making strategy shifts. And honestly, that’s part of RPM’s appeal. It’s a business that thrives on consistency and steady execution.
Key Dividend Metrics
💰 Forward Dividend Yield: 1.75%
📈 5-Year Average Dividend Yield: 1.74%
🔁 Payout Ratio: 37.35%
📆 Dividend Streak: 50 consecutive years of increases
🧾 Most Recent Dividend: $0.51 per share (paid January 31, 2025)
📅 Ex-Dividend Date: January 17, 2025
Dividend Overview
RPM’s dividend might not jump off the page at first glance, but that doesn’t mean it should be overlooked. The current yield of 1.75% sits comfortably in line with its five-year average. It’s not designed to dazzle with high yields but rather to deliver dependable, sustainable income.
The 37% payout ratio signals that the company is being smart about its distributions. It’s returning cash to shareholders while still preserving enough capital to reinvest in the business. That’s exactly the kind of balance dividend investors should be looking for.
And let’s not ignore the track record—50 straight years of dividend increases. That puts RPM in rare company. It’s the kind of record you can’t fake or fudge. It’s earned through decades of solid financial stewardship and reliable cash generation.
Dividend Growth and Safety
RPM’s dividend growth might be modest in any given year, but over time, it adds up. Historically, the company has delivered dividend increases in the mid-to-high single-digit range. That kind of compounding works in your favor the longer you hold the stock.
The dividend appears well-covered by both earnings and cash flow. Over the last twelve months, RPM generated $882 million in operating cash flow and $573 million in free cash flow. The dividend consumes only a fraction of that, which gives management plenty of breathing room—even in leaner years.
With low capital intensity and a steady business model, RPM doesn’t need to stretch to maintain or grow its payout. That’s what makes it a low-stress income play for the long-term.
Chart Analysis
Current Position in the Cycle
The chart for RPM International suggests the stock is transitioning out of the distribution phase and entering the markdown phase of the Wyckoff cycle. This shift has been gradual but noticeable. The rounded top pattern formed between November and January shows a classic distribution zone, where buyers and sellers were battling for control. The higher volumes on red days during this period hint at larger players offloading shares.
Since peaking around mid-December, RPM has failed to regain upward momentum. It’s now trading below its 50-day moving average, which is beginning to slope downward—a sign that shorter-term sentiment has turned bearish. The price has also dipped just under the 200-day moving average, suggesting that longer-term holders may start to reassess their positions if the weakness continues.
Volume Behavior
Volume spikes in October and again in early January highlight two key events. The first likely aligns with bullish enthusiasm, possibly earnings-related or macro news that drove buyers in. But the more recent volume surge during a downtrend points to increasing sell-side pressure. Over the past two months, volume has been gradually declining, which is typical after a distribution phase—momentum fades as selling accelerates and interest wanes.
Moving Averages
The stock price is now sandwiched between the 50-day and 200-day moving averages, having recently broken below both. The 50-day MA rolling over and crossing below the 200-day would mark a classic death cross, and while that hasn’t happened yet, it’s a risk on the near horizon.
What’s particularly telling is how the price has respected the 200-day moving average during the past few weeks—it tried to hold above it but failed, now closing under it with some conviction.
RSI and Momentum
The RSI has been trending down since late December, now sitting below the midpoint, but not yet oversold. This tells us that while momentum has clearly shifted bearish, there’s still room for further downside before hitting extreme territory.
The lack of bullish divergence in RSI further supports the view that there’s no reversal taking shape just yet. Buyers are hesitant, and sellers are gradually gaining control.
Candlestick Behavior
Looking at the most recent five candles, there’s a clear story of hesitation and breakdown. The first two show relatively small bodies with upper wicks—classic signs of intraday selling pressure stepping in after brief attempts to rally. The third candle is more decisive, with a stronger body and little to no wick on the top, signaling heavier selling. The fourth and fifth candles continue that tone, with narrow ranges and little follow-through from buyers.
All five candles reflect uncertainty, with a lean toward bearish momentum. The upper wicks especially stand out—they’re frequent and consistent, pointing to rejection at higher prices and a lack of conviction from buyers.
Price Structure and Trend
From a structural point of view, RPM had a clean uptrend from June through mid-December. That rally was well-supported by higher highs and higher lows, backed by solid volume. But once that trend broke, the shift was quick. Since January, the stock has formed a series of lower highs, with support levels breaking one after another.
There’s an emerging down-channel forming here, and unless RPM finds support quickly—potentially around $113 or just below—it could be setting up for a retest of the longer-term base from last spring.
Analyst Ratings
RPM International has recently seen a range of opinions from Wall Street, reflecting some division on where the stock is headed in the near term. Analysts are weighing its steady fundamentals against the current softness in its share price.
📈 Upgrades
- 🏦 Wells Fargo upgraded RPM from Equalweight to Overweight in early January, bumping the price target from $134 to $140. The move suggests growing confidence in RPM’s ability to navigate cost pressures while maintaining margins. The analysts highlighted improving supply chain dynamics and strong free cash flow as key positives.
- 🧮 Deutsche Bank held its Buy rating but made a slight adjustment, trimming the price target from $150 to $135. The change wasn’t due to any red flags—more of a recalibration to reflect slower near-term growth. Even with the lowered target, the outlook remains optimistic.
📉 Downgrades
- 🧾 JPMorgan took a more cautious stance back in July, downgrading RPM from Overweight to Neutral and setting a price target of $120. The firm pointed to concerns around slowing momentum in the commercial construction space and some uncertainty about pricing power going into the next few quarters.
- 🔍 UBS maintained its Neutral rating but made a small cut to its price target, moving it from $132 to $129 in mid-March. The adjustment was subtle, but it speaks to tempered expectations rather than any major shift in RPM’s fundamentals.
🎯 Consensus Price Target
The average analyst price target now sits around $134.07. Targets range from $117 on the low end to $154 on the high end, suggesting a modest upside from current levels. Most analysts see RPM as a solid operator, but sentiment is mixed depending on the timeframe and how quickly margins can recover.
💡 Why the Mixed Signals?
Much of the analyst activity is tied to RPM’s ability to manage costs and sustain earnings growth in a somewhat uneven macro backdrop. Some firms are encouraged by RPM’s historical resilience and dividend consistency. Others are looking at recent price action and signaling a more wait-and-see approach.
Overall, the varied ratings and price targets reflect a market still deciding whether RPM’s recent dip is a buying opportunity—or just the beginning of a longer consolidation phase.
Earning Report Summary
RPM International’s latest quarterly update gives off a sense of quiet confidence. There’s nothing flashy in the numbers, but everything about the report points to a company that knows its business, knows its market, and is handling things with discipline.
Steady Revenue Growth
Total sales for the quarter landed at $1.85 billion, which is a modest 3% increase from the same quarter last year. It’s not the kind of growth that gets the market overly excited, but it shows RPM’s consistency. They’re still moving forward, even with all the noise in the economy.
Strong Bottom Line
Earnings per share came in at $1.39, up almost 14% year-over-year. That’s the real highlight here. It shows that RPM is running more efficiently and finding ways to get more out of each dollar in revenue. This kind of earnings growth without major revenue expansion suggests tight cost controls and operational discipline.
Segment Performance
The Construction Products Group led the way, benefiting from demand in roofing and waterproofing. As commercial and residential projects pick up, this part of the business is seeing real traction.
The Performance Coatings Group held up decently, though some supply chain issues cropped up again. Nothing disastrous, but enough to keep things from really accelerating.
On the consumer side, things were a little more mixed. Raw material costs caused some pressure, but RPM offset that with smart pricing moves. That helped them maintain a decent margin without scaring off customers.
Specialty Products, their more niche segment, delivered another stable quarter, with cleaning and restoration products seeing steady demand.
Operational Improvements
Margins improved, and that’s thanks to a focus on manufacturing efficiency and better logistics. These aren’t the most exciting updates, but they matter. It’s this kind of operational fine-tuning that gives RPM more breathing room when costs rise or revenue slows.
Outlook
Looking forward, RPM is realistic. They’re aware that raw material costs could stay unpredictable and that demand in some markets may wobble. Still, with a solid balance sheet and multiple growth levers, they’re positioned to adapt.
The tone from leadership suggests cautious optimism—not overly bullish, but clearly confident in the business and its ability to stay resilient. All things considered, RPM’s latest report reflects a company moving forward at its own steady pace.
Financial Health and Stability
On the balance sheet, RPM shows signs of both strength and caution. The company holds about $269 million in cash and maintains a current ratio of 2.23, meaning it has more than enough short-term assets to cover its short-term liabilities.
Debt is something to watch, with a total debt load of $2.33 billion and a debt-to-equity ratio sitting just under 86%. It’s not low, but it’s also not alarming. The company’s ability to consistently generate free cash flow reduces the risk here.
Return on equity is impressive at over 25%, which shows management is making efficient use of shareholder capital. That’s always a reassuring sign for investors focused on long-term income and capital preservation.
Valuation and Stock Performance
RPM is currently trading around $116 per share, which is below both its 50-day and 200-day moving averages (each around $122). The stock has dipped slightly over the past year, down less than 1%, while the broader market has pushed higher. For some investors, that underperformance might signal an opportunity—especially if you believe in the long-term strength of the business.
The valuation is reasonable. RPM’s trailing P/E sits at just over 23, and the forward P/E drops to 18.8. That tells us earnings growth is expected to continue, and considering the latest quarter’s performance, that expectation isn’t far-fetched.
The company also trades at about 5.5 times book value and has an EV/EBITDA ratio around 15. These metrics suggest RPM isn’t a bargain-bin value play, but investors are paying a premium for quality and reliability.
Risks and Considerations
As with any industrial company, RPM is sensitive to macroeconomic cycles. A slowdown in commercial construction or industrial spending could weigh on earnings. The company’s diverse end markets help soften the blow, but it’s not immune to broader economic shifts.
Inflation and rising input costs are ongoing concerns. While RPM has done a good job managing these pressures recently, they can creep into margins over time. The company’s ability to pass through costs will be key if inflation persists.
Debt levels are manageable for now, but should leverage increase in the future—for acquisitions or expansion—it could change the equation slightly for income investors.
Lastly, while RPM has shown admirable consistency, it’s not particularly defensive. A sharp market correction or economic downturn could still pull the stock down with the tide, even if the fundamentals remain strong.
Final Thoughts
RPM International is the kind of stock that quietly builds wealth in the background. It won’t deliver flashy growth or soaring yields, but it will reward patient investors with dependable income and consistent performance. That’s the hallmark of a strong dividend play.
With a half-century of dividend growth under its belt, a conservative payout policy, and a steady stream of free cash flow, RPM stands out in a crowded field of industrial names. It doesn’t try to be something it’s not—and that’s part of its charm.
For investors who value durability and discipline, RPM continues to look like a name you can trust to keep showing up, quarter after quarter.