Ecovyst's prosperous future profit outlook isn't fully reflected in the current share price, indicating it's not too late to buy ECVT. Investors should also consider the strength of its balance sheet.

A low ROE combined with high debt is unappealing. Companies with high ROE and low debt are usually of good quality. Given equal ROE, less indebted companies are preferred.

The market overestimated the stock, with EPS reduction less than the annual share price drop. The recent uptick may be positive, but business fundamentals need to improve. Investors should note the 1 warning sign with Ecovyst.

Ecovyst's low ROE and high debt usage heightens risks and limits future possibilities. Firms with high ROE and moderate to low debt are generally seen as high-quality.