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Eastman Chemical (EMN) Well Placed on Cost & Debt Actions
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On Dec 14, we issued an updated research report on chemical maker Eastman Chemical (EMN - Free Report) .
Eastman Chemical’s diversified chemical portfolio remains its strength. The company is gaining from its actions to improve its cost position and boost productivity. It is also benefiting from synergies of acquisitions and capacity expansion initiatives.
Eastman Chemical has outperformed the Zacks categorized ‘Chemicals-Diversified’ industry over the past three months, partly attributable to its forecast-topping earnings performance in third-quarter 2016. The company’s shares have gained around 18.7% over this period, compared with roughly 11.7% gain recorded by the industry. Eastman Chemical gained from its cost-reduction actions and strong growth of its high value products in the third quarter.
Eastman Chemical remains focused on cost cutting and productivity actions amid a challenging operating environment. The company is looking to reduce at least $100 million of costs by the end of 2016. Eastman Chemical also expects to deliver an additional $100 million of cost savings in 2017.
In addition, Eastman Chemical remains committed to reduce debt and boost shareholder returns. The company reduced its net debt by more than $160 million in the third quarter. Its total debt fell roughly 6% year over year to $6,608 million at the end of the quarter.
Eastman Chemical cut debt by $400 million and returned roughly $325 million to shareholders during the first nine months of 2016 leveraging healthy free cash flows. The company remain on track to generate over $900 million of free cash flows in 2016.
Eastman Chemical’s board also recently hiked the quarterly cash dividend on the company’s common stock by 11% to 51 cents per share. This is for the seventh straight year that Eastman Chemical has increased its dividend.
Eastman Chemical is also gaining from synergies of acquisitions, especially Taminco Corporation. The purchase of Taminco has reinforced the company’s foothold in attractive niche end-markets including food, feed and agriculture where Taminco has a strong presence. The acquisition has also provided attractive cost and revenue synergy opportunities.
The acquisition of Solutia also represents a significant step in the company’s strategy to boost its foothold in the emerging markets, especially in Asia Pacific.
Eastman Chemical currently carries a Zacks Rank #2 (Buy).
FMC has an expected earnings growth of around 14.3% for the current year.
Chemours has an expected earnings growth of around 60.1% for the current year.
Innophos has an expected earnings growth of around 51.4% for the current year.
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Eastman Chemical (EMN) Well Placed on Cost & Debt Actions
On Dec 14, we issued an updated research report on chemical maker Eastman Chemical (EMN - Free Report) .
Eastman Chemical’s diversified chemical portfolio remains its strength. The company is gaining from its actions to improve its cost position and boost productivity. It is also benefiting from synergies of acquisitions and capacity expansion initiatives.
Eastman Chemical has outperformed the Zacks categorized ‘Chemicals-Diversified’ industry over the past three months, partly attributable to its forecast-topping earnings performance in third-quarter 2016. The company’s shares have gained around 18.7% over this period, compared with roughly 11.7% gain recorded by the industry. Eastman Chemical gained from its cost-reduction actions and strong growth of its high value products in the third quarter.
Eastman Chemical remains focused on cost cutting and productivity actions amid a challenging operating environment. The company is looking to reduce at least $100 million of costs by the end of 2016. Eastman Chemical also expects to deliver an additional $100 million of cost savings in 2017.
In addition, Eastman Chemical remains committed to reduce debt and boost shareholder returns. The company reduced its net debt by more than $160 million in the third quarter. Its total debt fell roughly 6% year over year to $6,608 million at the end of the quarter.
Eastman Chemical cut debt by $400 million and returned roughly $325 million to shareholders during the first nine months of 2016 leveraging healthy free cash flows. The company remain on track to generate over $900 million of free cash flows in 2016.
Eastman Chemical’s board also recently hiked the quarterly cash dividend on the company’s common stock by 11% to 51 cents per share. This is for the seventh straight year that Eastman Chemical has increased its dividend.
Eastman Chemical is also gaining from synergies of acquisitions, especially Taminco Corporation. The purchase of Taminco has reinforced the company’s foothold in attractive niche end-markets including food, feed and agriculture where Taminco has a strong presence. The acquisition has also provided attractive cost and revenue synergy opportunities.
The acquisition of Solutia also represents a significant step in the company’s strategy to boost its foothold in the emerging markets, especially in Asia Pacific.
Eastman Chemical currently carries a Zacks Rank #2 (Buy).
EASTMAN CHEM CO Price
EASTMAN CHEM CO Price | EASTMAN CHEM CO Quote
Other Stocks to Consider
Other well-placed companies in the chemical space include FMC Corp. (FMC - Free Report) , The Chemours Company (CC - Free Report) and Innophos Holdings Inc , all sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
FMC has an expected earnings growth of around 14.3% for the current year.
Chemours has an expected earnings growth of around 60.1% for the current year.
Innophos has an expected earnings growth of around 51.4% for the current year.
Zacks' Top Investment Ideas for Long-Term Profit
How would you like to see our best recommendations to help you find today’s most promising long-term stocks? Starting now, you can look inside our portfolios featuring stocks under $10, income stocks, value investments and more. These picks, which have double and triple-digit profit potential, are rarely available to the public. But you can see them now. Click here >>