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Eastman Chemical (EMN) Expands PVB Production Capabilities

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Eastman Chemical Company (EMN - Free Report) has wrapped up the expansion of production capabilities at its China-based Saflex polyvinyl butyral (“PVB”) facility.
 
The expansion at the PVB facility in Suzhou is particularly focused on enhancing production capabilities of Eastman Chemical advanced acoustic interlayer products. These products are used in laminated glass for automotive and architectural applications.

This investment testifies the company’s commitment to the glass glazing industry. The expansion will enable Eastman Chemical to cater to global customers in the Asia Pacific region with shorter lead times. This highlights the company’s continued commitment toward proactive response to higher customer demand.

The investment will strengthen Eastman Chemical’s ability to serve glass laminators and cater to the increasing demand for high performance and high-quality products for the Asia Pacific region. To support the future needs of the automotive industry, the company remains committed to investments in manufacturing, innovation and technology.

Saflex Q series is an advanced tri-layer PVB interlayer that considerably minimizes noise levels over standard automotive windscreens and conventional tempered windows. It also enhances automotive glass lamination in a number of ways, including UV protection, safety and security, solar control, and head-up display technology. Acoustic PVB interlayers from the Suzhou facility are slated to be available for customer qualification and use in the fourth quarter of 2018.

In a year’s time, shares of Eastman Chemical have outperformed the industry it belongs to. While the stock gained around 12.5%, the industry witnessed growth of 2.1%.



During the second-quarter earnings call, Eastman Chemical stated that strong volume gains in specialty businesses and disciplined cost management have helped the company achieve strong earnings growth in first-half 2018. The company continues to expect year-over-year growth of 10-14% in adjusted earnings per share for 2018.

The company is focused on productivity and cost-cutting actions, which are helping it offset raw material cost inflation and other cost headwinds. In 2018, Eastman Chemical expects to deliver $100 million of cost savings, under its cost-reduction program.
 

Zacks Rank and Stocks to Consider

Eastman Chemical currently carries a Zacks Rank #3 (Hold).

Some better-ranked companies in the basic materials space are Huntsman Corporation (HUN - Free Report) , Ingevity Corporation (NGVT - Free Report) and Celanese Corporation (CE - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Huntsman has an expected long-term earnings growth rate of 8.5%. Its shares have returned 4.2% in a year.

Ingevity has an expected long-term earnings growth rate of 12%. Its shares have surged 64.4% in the past year.

Celanese has an expected long-term earnings growth rate of 10%. Its shares have gained 15.4% in the past year.

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