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Eastman Chemical Co. (EMN)

by Zacks Equity Research

May 14, 2012 | Comments : 0 Recommended this article: (0)
EMN

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We are retaining our Outperform recommendation on Eastman Chemical Co. (EMN). First quarter adjusted earnings of $1.22 per share beat the Zacks Consensus Estimate. Revenue growth was aided by higher selling prices.

Moving ahead, we believe that the company is well placed to benefit in the second-half of the year from the synergies of its impending acquisition of Solutia. Eastman Chemical's diversified chemical portfolio, along with its integrated and diverse downstream businesses, is driving its earnings.

The company also benefits from business restructuring, recent acquisitions, cost-cutting measures and increased capacity additions. Our long-term Outperform recommendation on the stock indicates that it will perform above the broader market. Our price target of $61 is based on 11.7x our fiscal 2012 earnings estimate.

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