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Eastman Chemical (EMN) to Raise Price of Choline Chloride

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Eastman Chemical Company (EMN - Free Report) will raise the list and off-list selling prices of Choline Chloride by 4 cents per lb in North America. The price hike will be effective from Apr 1 or as contracts permit.

Eastman Chemical is taking appropriate pricing actions amid an escalated raw material pricing environment. High selling prices drove revenues in the company’s Chemical Intermediates segment in fourth-quarter 2017.

In the fourth quarter, Eastman Chemical’s reported earnings of $1.62 per share, up from $1.51 in the year ago-quarter. The results surpassed the Zacks Consensus Estimate of $1.06. Revenues rose around 8% year over year to $2,362 million, outpacing the Zacks Consensus Estimate of $2,289.5 million.

Eastman Chemical’s shares have moved up 43.4% over a year, outperforming the 20.4% gain of the industry it belongs to.

 

In 2018, the company expects to drive growth on the back of investments, innovation and high margin products. A modestly lower tax rate will support earnings growth in 2018. Eastman Chemical anticipates raw material and energy prices, especially for olefins, to be volatile this year. Eastman Chemical thus remains focused on cost-cutting and productivity actions, which will likely help it to offset raw material cost inflation and other cost headwinds. The company expects to deliver $100 million of cost savings in 2018 under its cost-reduction program. Its cost-reduction actions are expected to contribute to its earnings per share in 2018. The company expects adjusted EPS growth in 2018 to be 8-12% year over year.

The company should also gain from its strategic acquisitions, especially Taminco. Further, it remains committed to reduce debt and boost shareholder returns leveraging strong free cash flows. Eastman Chemical returned more than $646 million to shareholders during 2017..

Eastman Chemical Company Price and Consensus

 

 

Zacks Rank & Other Stocks to Consider

Eastman Chemical has a Zacks Rank #2 (Buy).

Some other top-ranked stocks in the chemical space are LyondellBasell Industries N.V. (LYB - Free Report) , Cabot Corporation (CBT - Free Report) and Methanex Corporation (MEOH - Free Report) .

LyondellBasell has an expected long-term earnings growth rate of 9% and sports a Zacks Rank #1 (Strong Buy). The company’s shares have moved up 23.2% in a year. You can see the complete list of today’s Zacks #1 Rank stocks here.

Cabot has an expected long-term earnings growth rate of 10% and flaunts a Zacks Rank #1. The company’s shares have moved up 5.5% in a year.

Methanex has an expected long-term earnings growth rate of 15% and carries a Zacks Rank #2. Its shares have gained 19.3% over a year.

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