In a report released today, Vincent Andrews from Morgan Stanley maintained a Buy rating on Eastman Chemical (EMN – Research Report), with a price target of $115.00.
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Vincent Andrews has given his Buy rating due to a combination of factors that suggest Eastman Chemical is poised for future growth despite recent setbacks. The company lost a significant $375 million grant from the Department of Energy for its Longview, Texas molecular recycling facility, which impacts the scope and timeline of the project. However, Andrews believes that Eastman is likely to proceed with the project by adjusting its scale to ensure appropriate capital expenditure and returns.
Moreover, Eastman’s commitment to fulfilling its supply contract with Pepsi for recycled PET (rPET) remains strong. While the Longview plant was initially intended to supply this contract, the company has the flexibility to meet its obligations from its Kingsport facility, ensuring economic viability. Despite higher capital expenditures and lower demand compared to 2021, Andrews sees Eastman’s strategic adjustments and continued focus on its core objectives as positive indicators for its stock performance.
In another report released on May 28, UBS also maintained a Buy rating on the stock with a $107.00 price target.