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Celanese Set to Raise Prices of Acetyl Intermediate Products

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Celanese Corporation (CE - Free Report) ) will raise list and off-list selling prices of acetyl intermediate products. The price hike will be put into effect for orders shipped on or after Oct 1, or as contracts permit.
 
The company will raise prices of Vinyl Acetate Monomer by €50/MT in Europe, Middle-East and Africa, 3 cents per lb in USA and Canada, and $65/MT in Mexico and South Africa. Moreover, prices of Low Density Polyethylene (LDPE) will be hiked by 3 cents per lb in USA and Canada.

Celanese is taking appropriate pricing actions amid a volatile pricing environment for raw materials. The company’s strategic measures, including operational cost savings through productivity actions and pricing initiatives, are likely to provide an impetus to its earnings in 2018.

In a year’s time, Celanese have underperformed the industry it belongs to. The stock has gained around 9.3% compared with the industry’s growth of 12.8%.



In July, Celanese raised its adjusted earnings per share guidance for 2018 to roughly $10.50-$10.75 on strength across Engineered Materials (EM) and Acetyl Chain units. The company expects the Acetyl Chain momentum to continue in the third quarter. The company also anticipates Acetate Tow earnings to remain relatively flat year over year in 2018.

Sales from the EM unit increased year over year in the second quarter. Growth in Asia and Americas’ product mix, recent acquisitions and project commercializations contributed to the division’s earnings. Moreover, the Acetyl Chain segment gained from improving acetyl industry fundamentals as well as higher volumes and pricing in the quarter.

However, Celanese witnessed lower volume and pricing in the second quarter in its Acetate Tow segment, owing to lower industry capacity utilization, partly offset by mix and productivity gains. 

Celanese Corporation Price and Consensus

 

Zacks Rank & Stocks to Consider

Celanese is a Zacks Rank #3 (Hold) stock.

Some better-ranked companies in the basic materials space are ArcelorMittal (MT - Free Report) , CF Industries Holdings, Inc. (CF - Free Report) and Air Products and Chemicals, Inc. (APD - Free Report) .

ArcelorMittal has an expected long-term earnings growth rate of 4.8% and a Zacks Rank #1 (Strong Buy). The company’s shares have gained 21.6% in the past year. You can see the complete list of today’s Zacks #1 Rank stocks here.

CF Industries has an expected long-term earnings growth rate of 6% and a Zacks Rank #2 (Buy). The company’s shares have rallied 52.9% in the past year.

Air Products has an expected long-term earnings growth rate of 16.2% and a Zacks Rank #2. Its shares have risen 11.5% in a year’s time.

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