In a report released today, Manav Gupta from UBS upgraded Calumet Specialty Products (CLMT – Research Report) to a Hold, with a price target of $12.00.
Manav Gupta has given his Hold rating due to a combination of factors impacting Calumet Specialty Products. The company’s stock price has seen a significant decline year-to-date, which now better reflects the risks associated with changes in tax credit policies and weaker free cash flow generation. Additionally, the recent data indicates a considerable drop in biodiesel production, suggesting that weaker producers are shutting down, which could positively affect RIN and LCFS prices, offering some support to CLMT.
Despite these potential positives, there are several challenges ahead. The company’s EBITDA estimates have been revised downward for the coming years due to weaker credit prices and rising costs of raw materials like fats and oils. Furthermore, the renewable diesel margins are currently just above break-even, with expectations of improvement only in the latter half of 2025. These factors, along with the revised price target, contribute to the decision to maintain a Hold rating on CLMT.
In another report released on March 4, TD Cowen also downgraded the stock to a Hold with a $16.00 price target.
Based on the recent corporate insider activity of 28 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.
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