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Why Is Chemours (CC) Up 10.7% Since Last Earnings Report?
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It has been about a month since the last earnings report for Chemours (CC - Free Report) . Shares have added about 10.7% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Chemours due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Chemours’ Earnings and Revenues Top Estimates in Q1
Chemours posted a profit of $234 million or $1.43 per share in the first quarter of 2022, up from a profit of $96 million or 57 cents in the year-ago quarter.
Barring one-time items, earnings came in at $1.46 per share for the reported quarter, topping the Zacks Consensus Estimate of 92 cents.
Net sales rose around 23% year over year to $1,764 million, beating the Zacks Consensus Estimate of $1,543.4 million. Volumes and prices contributed favorably to the top line growth in the quarter. The company, however, faced headwinds from raw material cost inflation and a challenging logistics environment.
Segment Highlights
The Titanium Technologies division logged revenues of $928 million in the quarter, up 28% year over year. Volumes rose 6% year over year while prices increased 24%. Volumes were driven by steady demand across all end-markets and regions notwithstanding the ore supply challenges. Prices rose due to contractual price changes and increases in the company’s Flex and Distribution channels.
Revenues in the Thermal & Specialized Solutions segment went up 40% year over year to $425 million in the reported quarter. Volumes increased 1% year over year on continued adoption of Opteon refrigerants, partly offset by the softness in automotive demand due to semiconductor shortages. Price contributed 40% to the division’s sales growth.
Revenues in the Advanced Performance Materials unit were $385 million, up roughly 16% year over year. Volume and price contributed 3% and 15%, respectively, to the sales growth. Volumes were driven by increased customer demand across nearly all regions and markets.
Chemours completed the sale of its Mining Solutions business to Draslovka in late 2021. The remaining Chemical Solutions business in the Other segment recorded sales of $26 million in the first quarter.
Financials
Chemours ended the quarter with cash and cash equivalents of $1,145 million, up roughly 14% year over year. Long-term debt was $3,692 million, down around 7% year over year.
Cash provided by operating activities was $2 million for the reported quarter, down from $39 million in the year-ago quarter.
Outlook
Chemours now sees adjusted EBITDA in the range of $1.475-$1.575 billion for 2022, up from $1.3-$1.425 billion it expected earlier.
Free cash flow for 2022 is now forecast to be more than $550 million, up from $500 million it expected earlier.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates revision.
The consensus estimate has shifted 17.24% due to these changes.
VGM Scores
Currently, Chemours has a subpar Growth Score of D, a grade with the same score on the momentum front. However, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Chemours has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
Chemours is part of the Zacks Chemical - Diversified industry. Over the past month, Olin (OLN - Free Report) , a stock from the same industry, has gained 6.2%. The company reported its results for the quarter ended March 2022 more than a month ago.
Olin reported revenues of $2.46 billion in the last reported quarter, representing a year-over-year change of +28.3%. EPS of $2.48 for the same period compares with $1.53 a year ago.
Olin is expected to post earnings of $2.59 per share for the current quarter, representing a year-over-year change of +49.7%. Over the last 30 days, the Zacks Consensus Estimate has changed +3.4%.
Olin has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of A.
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Why Is Chemours (CC) Up 10.7% Since Last Earnings Report?
It has been about a month since the last earnings report for Chemours (CC - Free Report) . Shares have added about 10.7% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Chemours due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Chemours’ Earnings and Revenues Top Estimates in Q1
Chemours posted a profit of $234 million or $1.43 per share in the first quarter of 2022, up from a profit of $96 million or 57 cents in the year-ago quarter.
Barring one-time items, earnings came in at $1.46 per share for the reported quarter, topping the Zacks Consensus Estimate of 92 cents.
Net sales rose around 23% year over year to $1,764 million, beating the Zacks Consensus Estimate of $1,543.4 million. Volumes and prices contributed favorably to the top line growth in the quarter. The company, however, faced headwinds from raw material cost inflation and a challenging logistics environment.
Segment Highlights
The Titanium Technologies division logged revenues of $928 million in the quarter, up 28% year over year. Volumes rose 6% year over year while prices increased 24%. Volumes were driven by steady demand across all end-markets and regions notwithstanding the ore supply challenges. Prices rose due to contractual price changes and increases in the company’s Flex and Distribution channels.
Revenues in the Thermal & Specialized Solutions segment went up 40% year over year to $425 million in the reported quarter. Volumes increased 1% year over year on continued adoption of Opteon refrigerants, partly offset by the softness in automotive demand due to semiconductor shortages. Price contributed 40% to the division’s sales growth.
Revenues in the Advanced Performance Materials unit were $385 million, up roughly 16% year over year. Volume and price contributed 3% and 15%, respectively, to the sales growth. Volumes were driven by increased customer demand across nearly all regions and markets.
Chemours completed the sale of its Mining Solutions business to Draslovka in late 2021. The remaining Chemical Solutions business in the Other segment recorded sales of $26 million in the first quarter.
Financials
Chemours ended the quarter with cash and cash equivalents of $1,145 million, up roughly 14% year over year. Long-term debt was $3,692 million, down around 7% year over year.
Cash provided by operating activities was $2 million for the reported quarter, down from $39 million in the year-ago quarter.
Outlook
Chemours now sees adjusted EBITDA in the range of $1.475-$1.575 billion for 2022, up from $1.3-$1.425 billion it expected earlier.
Free cash flow for 2022 is now forecast to be more than $550 million, up from $500 million it expected earlier.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates revision.
The consensus estimate has shifted 17.24% due to these changes.
VGM Scores
Currently, Chemours has a subpar Growth Score of D, a grade with the same score on the momentum front. However, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Chemours has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
Chemours is part of the Zacks Chemical - Diversified industry. Over the past month, Olin (OLN - Free Report) , a stock from the same industry, has gained 6.2%. The company reported its results for the quarter ended March 2022 more than a month ago.
Olin reported revenues of $2.46 billion in the last reported quarter, representing a year-over-year change of +28.3%. EPS of $2.48 for the same period compares with $1.53 a year ago.
Olin is expected to post earnings of $2.59 per share for the current quarter, representing a year-over-year change of +49.7%. Over the last 30 days, the Zacks Consensus Estimate has changed +3.4%.
Olin has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of A.