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Celanese Boosts TPC Production to Support Customer Growth

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Celanese Corporation (CE - Free Report) recently announced the expansion of Pibiflex and Riteflex thermoplastic co-polyester (“TPC”) production unit in the Donegani facility in Ferrara, Italy. The move is likely to support consistent growth in the global engineered materials business.

Celanese excels in the production and compounding of highly engineered materials, such as TPCs. Notably, TPCs are block co-polymers that offers tear, toughness and flex fatigue resistance over a wide range of temperature.

The capacity addition is likely to support growth in functionalized, sophisticated polymers. Celanese said that it will continue to partner with customers for delivering innovative solutions to address the increasing consumer and industrial needs. Also, it will help to respond the changing complexity in high-performance polymers.

In September 2018, Celanese successfully started operations in the solid-state polymerization unit at the Donegani facility. The company expects to expand production capacity of the unit by adding another polymerization line, which is expected to be completed in the next 15-18 months. The expansion highlights the company’s ability to respond to global customer demand.

Celanese’ shares have lost 4.8% in the past year, against the industry’s 2.4% rise.



In fourth-quarter 2018, Celanese’s adjusted earnings per share (EPS) rose 20.2% year over year to $2.38, missing the Zacks Consensus Estimate of $2.42.

The company projects adjusted EPS for 2019 to be roughly $10.50, considering slower start and expected moderation during the fourth quarter of 2019.  

Overall, the company’s underlying fundamentals and expected demand for products and solutions-based businesses are strong. Celanese expects to earn $12 per share in 2020 on the back of strength of business models, contributions from planned acquisition and organic investment projects.

Celanese Corporation Price and Consensus

 

Celanese Corporation Price and Consensus | Celanese Corporation Quote

 

Zacks Rank & Key Picks

Celanese currently carries a Zacks Rank #4 (Sell).

A few better-ranked stocks in the basic materials space include Kirkland Lake Gold Ltd. , Ingevity Corporation (NGVT - Free Report) and Materion Corporation (MTRN - Free Report) , all currently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Kirkland has an expected earnings growth rate of 8.8% for 2019. The company’s shares have surged 121.5% in the past year.

Ingevity has an expected earnings growth rate of 17.9% for 2019. The company’s shares have gained 40.1% in a year’s time.

Materion has an expected earnings growth rate of 12.6% for 2019. Its shares have gained 9% in a year’s time.

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