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Celanese (CE) to Report Q1 Earnings: What's in the Offing?

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Zacks Equity Research
·4 min read
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Celanese Corporation CE is set to release first-quarter 2021 results after market close on Apr 22. Benefits from productivity actions, investments in high-return organic projects and strategic acquisitions are likely to get reflected in its first-quarter performance. However, it is likely to have faced headwinds stemming from higher input costs.

The leading chemical and specialty materials maker beat the Zacks Consensus Estimate for earnings in all of the last four quarter. It has a trailing four-quarter earnings surprise of roughly 15.2%, on average. The company posted an earnings surprise of around 21.5% in the last reported quarter.

Celanese’s shares have gained 115.5% in the past year compared with 53.8% rise of the industry.

Let’s see how things are shaping up for this announcement.

What do the Estimates Say?

The Zacks Consensus Estimate for Celanese’s revenues in the to-be-reported quarter is pegged at $1,723 million, which suggests year-over-year increase of 18%.

The consensus mark for net sales in the Engineered Materials unit is currently pegged at $607 million for the first quarter, which calls for a 7.8% year-over-year increase.

Moreover, the Zacks Consensus Estimate for the Acetyl Chain segment’s net sales is currently pegged at $925 million that suggests a 15.8% rise from the year-ago quarter’s level. The same for the Acetate Tow division is pegged at $132 million, which suggests 2.3% year-over-year increase.

Factors at Play in Q1

Celanese is likely to have gained from its productivity actions, investments in high-return organic projects and strategic acquisitions in the quarter to be reported. Moreover, it is seeing a recovery in demand across most of its end markets. A strong rebound in demand in automotive and electronics end markets is likely to have contributed to its performance.

The company is also committed toward executing its productivity programs that include the implementation of a number of cost reduction capital projects.

The company’s strategic actions that include cost savings through productivity initiatives and price increase actions, are likely to have contributed to the bottom line in the to-be-reported quarter. Benefits of acquisitions are also expected to get reflected in first-quarter performance.

However, the company’s Engineered Materials segment is expected to have faced headwinds from elevated raw material costs. Higher input costs are likely to have hurt margins in the segment during the quarter under review. Some impacts of higher raw material costs are also expected to have persisted in the Acetyl Chain segment in the first quarter.

Subdued demand is also hurting volumes of acetate tow. As such, sales for the Acetate Tow unit are likely to have remained under pressure in the first quarter.

Celanese Corporation Price and EPS Surprise

Celanese Corporation Price and EPS Surprise
Celanese Corporation Price and EPS Surprise

Celanese Corporation price-eps-surprise | Celanese Corporation Quote

Zacks Model

Our proven model does not conclusively predict an earnings beat for Celanese this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.

Earnings ESP: Earnings ESP for Celanese is 0.00%. The Zacks Consensus Estimate for earnings for the first quarter is currently pegged at $3.01. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Celanese currently sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Stocks That Warrant a Look

Here are some companies in the basic materials space you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:

Albemarle Corporation ALB, scheduled to release earnings on May 5, has an Earnings ESP of +9.85% and carries a Zacks Rank #3.

AdvanSix Inc. ASIX, scheduled to release earnings on Apr 30, has an Earnings ESP of +7.69% and flaunts a Zacks Rank #1.

The Mosaic Company MOS, scheduled to release earnings on May 3, has an Earnings ESP of +3.06% and a Zacks Rank #1.

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