Scotiabank removes Methanex from ‘penalty box,’ upgrades to Outperform

As previously reported, Scotiabank upgraded Methanex (MEOH) to Outperform from Sector Perform with an unchanged price target of $53. The firm had placed Methanex “in the penalty box for two months” on fear the stock would be re-priced lower, but it now cites five reasons why it is returning Methanex to a Buy. Namely, the firm is seeing some mean reversion in U.S. trade policy; it likes the stock’s improved valuation entry point; several indicators suggest methanol prices are bottoming; Iran remains the number one source of upside risk this year; and there should be a case for slight multiple expansion over time, the analyst tells investors.