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Celanese (CE) Ups FY21 Earnings Outlook, Expects Higher Demand

·3 min read

Celanese Corporation CE increased its full-year 2021 outlook for adjusted earnings to $11.00-$11.50 per share. The midpoint of the latest guidance range reflects a 15% increase from the earlier range of $9.50-$10.00.

Celanese noted that its Texas and gulf coast operations were impacted by the winter storm Uri, yet its Clear Lake, Bishop and Bay City sites are operational with most units manufacturing at pre-storm levels.

The company also expects adjusted earnings of roughly $3 per share for the first quarter. It expects this momentum to continue in the middle of 2021 as increased demand for Acetyl Chain and Engineered Materials products is met. Celanese is uniquely positioned to reliably supply markets, which it projects will remain tight in mid-year post the winter storm, the company noted.

Shares of Celanese have surged 109.9% in the past year compared with 62.1% rise of the industry.

Celanese is gaining from its productivity actions, investments in high-return organic projects and strategic acquisitions. It is committed toward executing its productivity programs that include the implementation of a number of cost-reduction capital projects. The company achieved gross savings of $214 million from its productivity actions in 2020. Productivity actions are also expected to support to its margins in 2021.

The company is also seeing a recovery in demand across its end markets. Moreover, Celanese continues to actively pursue acquisitions, which are providing it opportunities for additional growth, investment and synergies.

Zacks Rank & Key Picks

Celanese currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the basic materials space are Fortescue Metals Group Limited FSUGY, Ashland Global Holdings Inc. ASH and Impala Platinum Holdings Limited IMPUY.

Fortescue has a projected earnings growth rate of 107.8% for the current fiscal. The company’s shares have surged 149.2% in a year. It currently flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Ashland has an expected earnings growth rate of 83.9% for the current fiscal. The company’s shares have gained 75.7% in the past year. It currently sports a Zacks Rank #1.

Impala has an expected earnings growth rate of 197.6% for the current fiscal. The company’s shares have skyrocketed 315.5% in the past year. It currently flaunts a Zacks Rank #1.

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