Calumet Specialty Products (CLMT – Research Report), the Energy sector company, was revisited by a Wall Street analyst today. Analyst Conor Fitzpatrick from Bank of America Securities reiterated a Buy rating on the stock and has a $20.00 price target.
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Conor Fitzpatrick has given his Buy rating due to a combination of factors related to the recent regulatory changes in California’s Low Carbon Fuel Standard (LCFS). The approval of new LCFS rules by California’s Office of Administrative Law introduces a step-down in carbon intensity mandates for gasoline and diesel starting in 2025, with further reductions in subsequent years. This regulatory shift is expected to tighten the LCFS credit market, transitioning from an oversupply to a deficit, which is anticipated to drive up credit prices significantly by the end of 2025 and into 2027.
Calumet Specialty Products (CLMT) is well-positioned to benefit from these changes due to its capability to process various feedstock types, including low-carbon options. This flexibility allows CLMT to optimize its operations and capitalize on LCFS credit opportunities, unlike some of its peers who may not be as adaptable. With the regulatory environment aligning with previous market forecasts, Fitzpatrick maintains a Buy rating on CLMT, supported by the expectation of improved market margins and regulatory certainty.
Based on the recent corporate insider activity of 31 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of CLMT in relation to earlier this year.