Education
About Us
Working with TipRanks
Follow Us
Eastman Chemical (EMN)
NYSE:EMN
Top Page
Eastman Chemical
(NYSE:EMN)
76Outperform
Positive Factors
Earnings Growth
Strong 2024 provides positive growth set up for 2025: EMN delivered solid 23% Y/Y EPS growth in 2024, driven by growth in higher sales volumes/mix from the end of customer destocking and innovation growth.
EBITDA Growth
Kingsport poised to reach $100MM incremental EBITDA run rate by the end of 2025, with demand remaining solid in both the durable and consumer packaging side.
Innovation
Eastman expects that their innovation with interlayers will continue to support market outgrowth.
Negative Factors
Consumer Confidence
Weaker consumer confidence could still trigger adjustments downstream.
Foreign Exchange
Headwinds from foreign exchange fluctuations are expected to challenge the company's financial performance.
Trade Policies
Protectionist trade policies likely cause another step-down in demand.
Eastman Chemical (EMN) vs. S&P 500 (SPY)
Market Cap
$8.78B
Dividend Yield4.31%
Average Volume (3M)1.40M
Price to Earnings (P/E)9.9
Beta (1Y)1.03
Revenue Growth1.91%
EPS Growth2.94%
CountryUS
Employees14,000
SectorBasic Materials
Sector Strength60
IndustryChemicals - Specialty
Share Statistics
EPS (TTM)7.69
Shares Outstanding115,459,910
10 Day Avg. Volume1,961,419
30 Day Avg. Volume1,400,347
Financial Highlights & Ratios
PEG Ratio3.37
Price to Book (P/B)N/A
Price to Sales (P/S)1.09
Price to Cash Flow (P/CF)4.70
P/FCF Ratio4.40
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$108.00Price Target Upside37.84% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering13
Eastman Chemical Business Overview & Revenue Model
Company DescriptionEastman Chemical Company is a global specialty materials company that produces a broad range of advanced materials, additives, functional products, specialty chemicals, and fibers. Headquartered in Kingsport, Tennessee, Eastman operates in various sectors, including transportation, building and construction, agriculture, consumables, and personal care, providing innovative solutions that enhance product performance and sustainability.
How the Company Makes MoneyEastman Chemical makes money primarily through the manufacture and sale of specialty chemicals and advanced materials. The company operates through several business segments, including Additives & Functional Products, Advanced Materials, Chemical Intermediates, and Fibers. Revenue is generated from selling products like coatings, adhesives, specialty plastics, and fibers to various industries, including automotive, consumer goods, electronics, and textiles. Significant earnings are derived from long-term supply agreements, research and development partnerships, and a focus on innovation in sustainable and high-performance materials. The company leverages its global production and distribution network to serve a diverse customer base, contributing to consistent revenue streams.
Eastman Chemical Financial Statement Overview
Summary
Eastman Chemical demonstrates a strong financial position with robust profitability and efficient operational controls. The company has a solid balance sheet with reduced debt, enhancing financial stability. While revenue growth is modest, cash flow generation is strong, indicating good liquidity and operational efficiency.Income Statement
Eastman Chemical shows a robust performance with a strong gross profit margin of 24.4% for 2024, attributed to efficient cost management. The net profit margin remains healthy at 9.6%, indicating solid profitability. Revenue growth is moderate at 1.9% compared to the previous year, suggesting stability but limited top-line expansion. EBIT and EBITDA margins are strong at 13.9%, reflecting effective operational control. However, revenue has not returned to 2022 levels, indicating potential growth challenges.78
Positive
Balance Sheet
The balance sheet of Eastman Chemical is solid, with a substantial equity base. The equity ratio is 38%, indicating a strong reliance on equity for financing. The company has significantly reduced its debt, resulting in a debt-to-equity ratio of 0, showcasing financial prudence. Return on equity is commendable at 15.7%, indicating efficient use of shareholders' funds. The reduction in total debt improves financial stability and reduces leverage risk.85
Very Positive
Cash Flow
Cash flow analysis reveals strong free cash flow growth of 27.2% in 2024, highlighting improved cash generation capabilities. The operating cash flow to net income ratio stands at 1.42, indicating strong cash earnings support. The free cash flow to net income ratio of 0.76 suggests effective capital expenditure management and healthy free cash flow generation. Overall, cash flow metrics demonstrate the company's solid liquidity position and operational efficiency.82
Very Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 9.38B | 9.21B | 10.58B | 10.48B | 8.47B | Gross Profit |
| 2.29B | 2.06B | 2.14B | 2.50B | 1.98B | EBIT |
| 1.30B | 1.09B | 1.25B | 1.88B | 968.00M | EBITDA |
| 1.80B | 1.81B | 1.73B | 2.42B | 1.54B | Net Income Common Stockholders |
| 905.00M | 894.00M | 793.00M | 857.00M | 478.00M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 837.00M | 548.00M | 493.00M | 459.00M | 564.00M | Total Assets |
| 15.21B | 14.63B | 14.67B | 15.52B | 16.08B | Total Debt |
| 5.02B | 4.97B | 5.15B | 5.16B | 5.62B | Net Debt |
| 4.18B | 4.42B | 4.66B | 4.70B | 5.05B | Total Liabilities |
| 9.36B | 9.10B | 9.43B | 9.73B | 9.97B | Stockholders Equity |
| 5.78B | 5.46B | 5.15B | 5.70B | 6.02B |
| Cash Flow | Free Cash Flow | |||
| 688.00M | 541.00M | 351.00M | 1.04B | 1.07B | Operating Cash Flow |
| 1.29B | 1.37B | 975.00M | 1.62B | 1.46B | Investing Cash Flow |
| -534.00M | -432.00M | 392.00M | -29.00M | -394.00M | Financing Cash Flow |
| -454.00M | -888.00M | -1.32B | -1.69B | -704.00M |
Eastman Chemical Technical Analysis
Negative
78.35
Price Trends
92.45
Negative
93.51
Negative
96.65
Negative
Market Momentum
-2.04
Positive
37.55
Neutral
28.89
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EMN, the sentiment is Negative. The current price of 78.35 is below the 20-day moving average (MA) of 84.98, below the 50-day MA of 92.45, and below the 200-day MA of 96.65, indicating a bearish trend. The MACD of -2.04 indicates Positive momentum. The RSI at 37.55 is Neutral, neither overbought nor oversold. The STOCH value of 28.89 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for EMN.
Eastman Chemical Risk Analysis
Eastman Chemical disclosed 15 risk factors in its most recent earnings report. Eastman Chemical reported the most risks in the “Legal & Regulatory” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Eastman Chemical Peers Comparison
Overall Rating
UnderperformOutperform
Sector (47)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $8.78B | 9.91 | 16.11% | 4.31% | 1.91% | 2.94% | |
66 Neutral | $22.36B | 16.52 | 19.13% | 2.73% | -4.59% | 11.09% | |
66 Neutral | $10.83B | 14.10 | 12.69% | ― | -2.64% | 120.05% | |
62 Neutral | $12.04B | 20.22 | 5.76% | 2.38% | -3.24% | 24.29% | |
48 Neutral | $7.11B | ― | -12.18% | 2.95% | -44.08% | -183.44% | |
48 Neutral | $9.62B | ― | -7.56% | 4.10% | -39.35% | -120.09% | |
47 Neutral | $2.43B | -3.06 | -22.76% | 3.59% | 4.02% | -29.07% |
* Basic Materials Sector Average
Performance Comparison
EMN
Eastman Chemical
78.35
-16.38
-17.29%
ALB
Albemarle
56.67
-63.74
-52.94%
PPG
PPG Industries
100.73
-30.80
-23.42%
SQM
Sociedad Quimica Y Minera SA
34.82
-12.98
-27.15%
WLK
Westlake Chemical
89.74
-61.35
-40.60%
AVTR
Avantor
15.22
-9.74
-39.02%
Eastman Chemical Earnings Call Summary
Earnings Call Date: Jan 30, 2025 | % Change Since: -14.67% | Next Earnings Date: Apr 24, 2025
Earnings Call Sentiment Neutral
The earnings call reflects a balanced performance with significant achievements in Advanced Materials and AFP segments, operational improvements in the methanolysis plant, and stability in the fibers business. However, challenges such as headwinds in Advanced Materials, fourth-quarter underperformance, and competitive pressures in Chemical Intermediates balance out these positives.Highlights
Advanced Materials Growth
The Advanced Materials segment showed impressive recovery with strong performance despite a challenging macroeconomic environment, driven by innovation and strategic growth initiatives, including a $50 million contribution from the circular platform.
Successful Methanolysis Plant Operations
The Kingsport methanolysis plant demonstrated operational improvement, achieving 85% DMT yield since its last turnaround, leading to expectations of strong operational leverage in 2025.
AFP Segment Strong Performance
AFP segment delivered high single-digit growth, outperforming expectations due to strong volume and mix growth, price discipline, and cost management.
Fibers Business Stability
The fibers business is expected to maintain attractive pricing and margins due to stable end-market demand and strategic multi-year contracting with customers.
Lowlights
Advanced Materials Headwinds
Advanced Materials faces headwinds from increasing natural gas prices and currency fluctuations, which are expected to offset some volume and mix growth.
Fourth Quarter Challenges
Eastman experienced modest underperformance in the fourth quarter, missing the low-end of guidance due to higher costs associated with reduced uptime earlier in the year.
Fibers Destocking and Product Discontinuation
The fibers segment is facing destocking and the discontinuation of a profitable product, which are expected to impact performance in 2025.
Chemical Intermediates Competitive Pressure
The Chemical Intermediates segment is experiencing competitive pressure and a challenging environment, impacting spreads and margins.
Company Guidance
During the Eastman Fourth Quarter and Full-Year 2024 Conference Call, the company provided guidance indicating strong performance expectations for 2025, despite facing some headwinds. The Advanced Materials segment is projected to deliver significant growth, driven by the circular platform with an expected contribution of $50 million in earnings, while the overall circular economy growth is guided to be between $75 million to $100 million. The company anticipates cost management efforts to yield $50 million in savings, offsetting some impacts from higher natural gas prices and currency fluctuations, which are expected to be $50 million and $30 million, respectively. In the Fibers segment, despite some destocking, the company maintains stable long-term contracts covering over 80% of 2026 volumes. Additionally, Eastman expects to maintain its $1.3 billion operating cash flow for 2025, with a focus on EBITDA growth and higher cash taxes, and plans to execute $200 million in share buybacks.Eastman Chemical Corporate Events
Executive/Board Changes
Eastman Chemical Announces Severance Agreement with Executive
Neutral
Mar 14, 2025
On March 10, 2025, Eastman Chemical Company entered into a severance agreement with Brad A. Lich, outlining severance benefits in the event of certain employment terminations. The agreement includes a $2 million cash severance payment and up to four months of healthcare coverage, contingent on compliance with restrictive covenants and a release of claims.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.