Is RPM a good stock to buy? We came across a bullish thesis on RPM International Inc. on Quality At A Fair Price’s Substack. In this article, we will summarize the bulls’ thesis on RPM. RPM International Inc.’s share was trading at $104.61 as of June 8th. RPM’s trailing and forward P/E were 20.22 and 17.79 respectively according to Yahoo Finance.
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RPM International Inc. provides specialty chemicals for the construction, industrial, specialty, and consumer markets. RPM appears to offer a compelling dividend growth opportunity as the specialty chemicals company continues to strengthen its position across coatings, sealants, building materials, and related industrial solutions. Through its portfolio of market-leading subsidiaries, RPM International has built a highly diversified and resilient business model that serves both consumer and industrial markets, allowing the company to generate steady cash flows across economic cycles.
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The company currently offers a forward dividend yield of approximately 2.14%, notably above its 5-year average yield of 1.80%, implying that RPM International may be undervalued by nearly 16% based on Dividend Yield Theory metrics. This disconnect creates an attractive setup for long-term investors seeking both income and capital appreciation potential.
RPM International’s dividend profile further reinforces the bullish thesis. The company has delivered more than 50 consecutive years of dividend increases, placing it among the elite group of long-standing dividend compounders. Its dividend growth trajectory has remained remarkably consistent, with a 10-year dividend growth rate approaching 7% and a stronger 5-year growth rate of roughly 8%, highlighting management’s confidence in the durability of earnings and cash flow generation.
In addition, RPM International’s projected earnings growth and future CAGR estimates above 12% suggest that the market may still be underappreciating the company’s long-term growth potential. With a combination of reliable dividend expansion, attractive valuation, and strong operating fundamentals, RPM International appears well-positioned to deliver solid shareholder returns in the years ahead.
Previously, we covered a bullish thesis on Eastman Chemical Company (EMN) by Necessary-Damage5658 in November 2024, which highlighted the company’s ability to benefit from export control changes and rising demand for compliant chemical suppliers. EMN’s stock price has depreciated by approximately 29.09% since our coverage. Quality At A Fair Price shares a similar view but emphasizes RPM International’s dividend growth profile and diversified specialty chemicals business.
RPM International Inc. is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 40 hedge fund portfolios held RPM at the end of the first quarter which was 39 in the previous quarter. While we acknowledge the risk and potential of RPM as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than RPM and that has 10,000% upside potential, check out our report about this cheapest AI stock.
Disclosure: None.
