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Celanese (CE) Gains on Acquisitions & Productivity Actions
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Celanese Corporation (CE - Free Report) is benefiting from its productivity measures, investments in organic projects and strategic acquisitions amid headwinds from demand softness and customer de-stocking in certain end markets.
Shares of this leading chemical and specialty materials maker are up 22.7% over a year compared with a 17.2% rise of its industry.
Image Source: Zacks Investment Research
Celanese, a Zacks Rank #3 (Hold) stock, is gaining from its cost and productivity actions, investments in high-return organic projects and synergies of acquisitions.
The company is actively pursuing acquisitions, which are providing it opportunities for additional growth, investment and synergies. The acquisition of the majority of DuPont’s Mobility & Materials (“M&M”) business has allowed Celanese to enhance its growth in high-value applications. M&M contributed $125 million to the company’s operating EBITDA in third-quarter 2023, up 15% sequentially. Celanese sees a sequential increase in contribution in the fourth quarter.
The acquisitions of SO.F.TER., Nilit and Omni Plastics are also expected to contribute to earnings expansion in the company's Engineered Materials segment. The Elotex acquisition also strengthened the company’s position in the vinyl acetate ethylene emulsions space. Moreover, the purchase of Exxon Mobil's Santoprene business broadened the company’s portfolio of engineered solutions and enables it to offer a wider range of functionalized solutions to targeted growth areas, including future mobility, medical and sustainability.
Celanese also remains focused on executing its productivity programs that include the implementation of a number of cost reduction capital projects. Productivity actions are expected to support to its margins.
The company is proactively implementing strategic initiatives recognizing the volatility and unpredictability of the current market landscape and competitive environment. These actions involve strengthening its commercial teams, aligning production and inventory levels with prevailing demand, implementing cost-saving measures, and optimizing cash flow. These endeavors are expected to result in robust cash generation and a continuation of earnings growth.
However, Celanese is exposed to challenges from soft demand and customer de-stocking in certain end markets. It witnessed weak demand in several end markets and continued customer de-stocking in the third quarter of 2023. Soft demand has led to inventory reduction and deferral of orders by the company’s customers. Demand remains weak in industrial and electrical & electronics end markets. Weaker demand recovery globally and de-stocking are likely to continue to weigh on the company’s volumes and pricing in the fourth quarter.
Better-ranked stocks worth a look in the basic materials space include, Cameco Corporation (CCJ - Free Report) , Carpenter Technology Corporation (CRS - Free Report) and Cabot Corporation (CBT - Free Report) .
Cameco has a projected earnings growth rate of 156% for the current year. The Zacks Consensus Estimate for CCJ’s current-year earnings has been revised upward by 6.7% over the past 60 days. The stock is up around 76% in a year. CCJ currently carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The consensus estimate for Carpenter Technology’s current fiscal year earnings is pegged at $3.96, indicating a year-over-year surge of 247.4%. CRS, carrying a Zacks Rank #1, beat the Zacks Consensus Estimate in all of the last four quarters, with the average earnings surprise being 14.3%. The company’s shares have rallied 52% in the past year.
The consensus estimate for Cabot’s current fiscal-year earnings is pegged at $6.58, indicating a year-over-year rise of 22.3%. CBT, carrying a Zacks Rank #2 (Buy), beat the Zacks Consensus Estimate in three of the last four quarters while missed once, with the average earnings surprise being 2.3%. The company’s shares are up around 6% in the past year.
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Celanese (CE) Gains on Acquisitions & Productivity Actions
Celanese Corporation (CE - Free Report) is benefiting from its productivity measures, investments in organic projects and strategic acquisitions amid headwinds from demand softness and customer de-stocking in certain end markets.
Shares of this leading chemical and specialty materials maker are up 22.7% over a year compared with a 17.2% rise of its industry.
Image Source: Zacks Investment Research
Celanese, a Zacks Rank #3 (Hold) stock, is gaining from its cost and productivity actions, investments in high-return organic projects and synergies of acquisitions.
The company is actively pursuing acquisitions, which are providing it opportunities for additional growth, investment and synergies. The acquisition of the majority of DuPont’s Mobility & Materials (“M&M”) business has allowed Celanese to enhance its growth in high-value applications. M&M contributed $125 million to the company’s operating EBITDA in third-quarter 2023, up 15% sequentially. Celanese sees a sequential increase in contribution in the fourth quarter.
The acquisitions of SO.F.TER., Nilit and Omni Plastics are also expected to contribute to earnings expansion in the company's Engineered Materials segment. The Elotex acquisition also strengthened the company’s position in the vinyl acetate ethylene emulsions space. Moreover, the purchase of Exxon Mobil's Santoprene business broadened the company’s portfolio of engineered solutions and enables it to offer a wider range of functionalized solutions to targeted growth areas, including future mobility, medical and sustainability.
Celanese also remains focused on executing its productivity programs that include the implementation of a number of cost reduction capital projects. Productivity actions are expected to support to its margins.
The company is proactively implementing strategic initiatives recognizing the volatility and unpredictability of the current market landscape and competitive environment. These actions involve strengthening its commercial teams, aligning production and inventory levels with prevailing demand, implementing cost-saving measures, and optimizing cash flow. These endeavors are expected to result in robust cash generation and a continuation of earnings growth.
However, Celanese is exposed to challenges from soft demand and customer de-stocking in certain end markets. It witnessed weak demand in several end markets and continued customer de-stocking in the third quarter of 2023. Soft demand has led to inventory reduction and deferral of orders by the company’s customers. Demand remains weak in industrial and electrical & electronics end markets. Weaker demand recovery globally and de-stocking are likely to continue to weigh on the company’s volumes and pricing in the fourth quarter.
Celanese Corporation Price and Consensus
Celanese Corporation price-consensus-chart | Celanese Corporation Quote
Stocks to Consider
Better-ranked stocks worth a look in the basic materials space include, Cameco Corporation (CCJ - Free Report) , Carpenter Technology Corporation (CRS - Free Report) and Cabot Corporation (CBT - Free Report) .
Cameco has a projected earnings growth rate of 156% for the current year. The Zacks Consensus Estimate for CCJ’s current-year earnings has been revised upward by 6.7% over the past 60 days. The stock is up around 76% in a year. CCJ currently carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The consensus estimate for Carpenter Technology’s current fiscal year earnings is pegged at $3.96, indicating a year-over-year surge of 247.4%. CRS, carrying a Zacks Rank #1, beat the Zacks Consensus Estimate in all of the last four quarters, with the average earnings surprise being 14.3%. The company’s shares have rallied 52% in the past year.
The consensus estimate for Cabot’s current fiscal-year earnings is pegged at $6.58, indicating a year-over-year rise of 22.3%. CBT, carrying a Zacks Rank #2 (Buy), beat the Zacks Consensus Estimate in three of the last four quarters while missed once, with the average earnings surprise being 2.3%. The company’s shares are up around 6% in the past year.