Celanese Reaches 52-Week High - Analyst Blog

Shares of Celanese Corporation CE hit a new 52-week high of $61.98 on May 2 and eventually closed at $61.18. The company's long-term estimated earnings per share EPS growth rate is 8.7%. Average volume of shares traded over the last three months was roughly 1,059K.

Growth Drivers

Celanese posted strong first-quarter 2014 results on Apr 21. It reported adjusted earnings (excluding one-time items) of $1.33 per share, up 16.7% from $1.14 per share reported in the year-ago quarter. The results topped the Zacks Consensus Estimate of $1.21.

Profit from continued operations (as reported) came in at $1.25 per share in the first quarter, surging roughly 42% from 88 cents per share posted in the prior-year quarter.

Sales in the quarter were $1,705 million, up 6.2% year over year, surpassing the Zacks Consensus Estimate of $1,682 million.
Celanese's strong presence in emerging markets will enable it to deliver incremental earnings in 2014. The company has taken up cost-cutting measures and the necessary steps to run its plants better and counter weak demand. Moreover, Celanese continues to generate strong cash flows and remains focused on returning value to its shareholders.
 
Celanese is aggressively expanding its capacity in the emerging Asian markets. Its expansion initiatives in China are expected to support earnings growth. Celanese's integrated chemical complex in Nanjing, China, serves as a base for expansion in Asia, supporting the region's increasing demand.

For 2014, Celanese expects earnings to be driven by company-specific initiatives including innovation of new products and enhancement of efficiencies through productivity, and expects earnings growth of 12% to 14% in 2014. These initiatives are expected to drive earnings growth in 2014.

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

Other Stocks to Consider

Other chemical stocks worth considering include Compass Minerals International Inc. CMP, Eastman Chemical Co. EMN, and L'Air Liquide SA (AIQUY). While Compass Minerals International carries a Zacks Rank #1 (Strong Buy), Eastman Chemical and L'Air Liquide retain a Zacks Rank #2 (Buy).