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The company surpassed Zacks Consensus Estimate for earnings in three of the last four quarters while missing it once. It delivered a trailing four-quarter earnings surprise of around 1.9% on average. It pulled off an earnings surprise of 1.4% in the last reported quarter.
Eastman is expected to have benefited from cost-cutting and productivity initiatives, as well as its innovation-driven growth strategy. However, headwinds, including lower demand and customer de-stocking, are likely to have weighed on its fourth-quarter performance.
The stock has lost 1.6% in the past year compared with the industry’s fall of 17.5%.
Image Source: Zacks Investment Research
Let’s see how things are shaping up for this announcement.
Zacks Model
Our proven model predicts an earnings beat for Eastman Chemical this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earning beat.
Earnings ESP: Earnings ESP for Eastman Chemical is +4.01%. The Zacks Consensus Estimate for the fourth quarter is currently pegged at $1.28. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Eastman Chemical currently carries a Zacks Rank #3.
What Do the Estimates Say?
The Zacks Consensus Estimate for sales for the to-be-reported quarter is currently pegged at $2,166.7 million, which implies a decline of 8.7% from the year-ago reported number.
Our estimate for EMN’s Additives and Functional Products division’s revenues is pegged at $606.7 million, suggesting a fall of 19.8% year over year. The same for the Advanced Materials unit’s revenues is $748.9 million, indicating a rise of 1.8%.
Our estimate for Eastman’s Chemical Intermediates segment’s revenues is pegged at $438.5 million, suggesting a decline of 22.3%. The same for the Fiber segment stands at $378 million, indicating an increase of 19.3% year over year.
Some Factors to Watch
Eastman is expected to have benefited from its cost-cutting measures in the fourth quarter. The company's operational transformation effort is likely to have resulted in decreased operating costs in the quarter. It expects to reduce manufacturing, supply chain and non-manufacturing costs by more than $200 million for full-year 2023, net of inflation. Lower raw material and energy costs, as well as pricing actions, are likely to have aided the company's bottom line in the December quarter.
The company’s performance is likely to have been supported by efforts to generate new business revenues from its innovative growth model. Its innovation and market development initiatives are expected to have aided sales volumes in the quarter to be reported.
However, Eastman Chemical's performance is likely to have been hurt by the lingering impacts of customer inventory de-stocking. The company saw soft demand and consumer de-stocking for its consumer durables, building & construction, agriculture, medical and consumables end markets in the third quarter of 2023. De-stocking is likely to have had an impact on the company's volumes and top line in the fourth quarter as well.
EMN, in its third-quarter call, stated that it expects muted demand in the fourth quarter as customers are cautious in the prevailing challenging environment. In addition, it anticipates regular seasonality in key end markets, including building and construction, consumer durables and performance films for automotive applications.
Here are some companies in the basic materials space you may want to consider as our model shows they too have the right combination of elements to post an earnings beat this quarter:
The consensus estimate for NTR’s earnings for the fourth quarter is currently pegged at 72 cents.
Agnico Eagle Mines Limited (AEM - Free Report) , slated to release earnings on Feb 15, has an Earnings ESP of +8.23% and carries a Zacks Rank #3 at present.
The consensus mark for AEM’s fourth-quarter earnings is currently pegged at 46 cents.
Kinross Gold Corporation (KGC - Free Report) , scheduled to release fourth-quarter earnings on Feb 14, has an Earnings ESP of +16.37%.
The Zacks Consensus Estimate for Kinross' earnings for the fourth quarter is currently pegged at 9 cents. KGC currently carries a Zacks Rank #3.
Image: Bigstock
Eastman Chemical (EMN) to Post Q4 Earnings: Factors at Play
Eastman Chemical Company (EMN - Free Report) is scheduled to release fourth-quarter 2023 results after the closing bell on Feb 1.
The company surpassed Zacks Consensus Estimate for earnings in three of the last four quarters while missing it once. It delivered a trailing four-quarter earnings surprise of around 1.9% on average. It pulled off an earnings surprise of 1.4% in the last reported quarter.
Eastman is expected to have benefited from cost-cutting and productivity initiatives, as well as its innovation-driven growth strategy. However, headwinds, including lower demand and customer de-stocking, are likely to have weighed on its fourth-quarter performance.
The stock has lost 1.6% in the past year compared with the industry’s fall of 17.5%.
Image Source: Zacks Investment Research
Let’s see how things are shaping up for this announcement.
Zacks Model
Our proven model predicts an earnings beat for Eastman Chemical this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earning beat.
Earnings ESP: Earnings ESP for Eastman Chemical is +4.01%. The Zacks Consensus Estimate for the fourth quarter is currently pegged at $1.28. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Eastman Chemical currently carries a Zacks Rank #3.
What Do the Estimates Say?
The Zacks Consensus Estimate for sales for the to-be-reported quarter is currently pegged at $2,166.7 million, which implies a decline of 8.7% from the year-ago reported number.
Our estimate for EMN’s Additives and Functional Products division’s revenues is pegged at $606.7 million, suggesting a fall of 19.8% year over year. The same for the Advanced Materials unit’s revenues is $748.9 million, indicating a rise of 1.8%.
Our estimate for Eastman’s Chemical Intermediates segment’s revenues is pegged at $438.5 million, suggesting a decline of 22.3%. The same for the Fiber segment stands at $378 million, indicating an increase of 19.3% year over year.
Some Factors to Watch
Eastman is expected to have benefited from its cost-cutting measures in the fourth quarter. The company's operational transformation effort is likely to have resulted in decreased operating costs in the quarter. It expects to reduce manufacturing, supply chain and non-manufacturing costs by more than $200 million for full-year 2023, net of inflation. Lower raw material and energy costs, as well as pricing actions, are likely to have aided the company's bottom line in the December quarter.
The company’s performance is likely to have been supported by efforts to generate new business revenues from its innovative growth model. Its innovation and market development initiatives are expected to have aided sales volumes in the quarter to be reported.
However, Eastman Chemical's performance is likely to have been hurt by the lingering impacts of customer inventory de-stocking. The company saw soft demand and consumer de-stocking for its consumer durables, building & construction, agriculture, medical and consumables end markets in the third quarter of 2023. De-stocking is likely to have had an impact on the company's volumes and top line in the fourth quarter as well.
EMN, in its third-quarter call, stated that it expects muted demand in the fourth quarter as customers are cautious in the prevailing challenging environment. In addition, it anticipates regular seasonality in key end markets, including building and construction, consumer durables and performance films for automotive applications.
Eastman Chemical Company Price and EPS Surprise
Eastman Chemical Company price-eps-surprise | Eastman Chemical Company Quote
Stocks That Warrant a Look
Here are some companies in the basic materials space you may want to consider as our model shows they too have the right combination of elements to post an earnings beat this quarter:
Nutrien Ltd. (NTR - Free Report) , scheduled to release earnings on Feb 21, has an Earnings ESP of +8.52% and carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
The consensus estimate for NTR’s earnings for the fourth quarter is currently pegged at 72 cents.
Agnico Eagle Mines Limited (AEM - Free Report) , slated to release earnings on Feb 15, has an Earnings ESP of +8.23% and carries a Zacks Rank #3 at present.
The consensus mark for AEM’s fourth-quarter earnings is currently pegged at 46 cents.
Kinross Gold Corporation (KGC - Free Report) , scheduled to release fourth-quarter earnings on Feb 14, has an Earnings ESP of +16.37%.
The Zacks Consensus Estimate for Kinross' earnings for the fourth quarter is currently pegged at 9 cents. KGC currently carries a Zacks Rank #3.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.