RBC Capital Cuts Celanese Price Target By 42% - Read Why - Celanese (NYSE:CE)

RBC Capital analyst Arun Viswanathan downgraded Celanese Corp CE to Sector Perform from Outperform and lowered the price target to $116 (8% upside) from $200.
The analyst downgraded the ratings reflecting anticipated peak acetic/VAM prices, higher natural gas costs, and higher expected leverage.
Viswanathan mentions that according to IHS, North America Acetic and VAM contract prices are expected to peak in 2Q22-3Q22 at ~$1000/mt and ~$1600/mt, respectively, and decline roughly 15-20% into 2023. As a result, AC chain earnings at CE will likely wane in 2H22 and into 2023.
The analyst noted that higher energy costs, particularly natural gas in Europe and in CE's EM segment, will likely continue to put pressure on margins into 2H22 and 2023.
Viswanathan believes the stock is likely rangebound throughout the year as the market awaits stabilization and the M&M deal closing.
B of A Securities analyst Matthew DeYoe maintained Celanese with a Neutral rating and lowered the price target from $171 to $144 (34% upside).
Price Action: CE shares are trading lower by 3.77% at $107.45 on the last check Wednesday.
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Momentum9.72

Growth15.45

Quality-

Value33.41

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Medium

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RBC Capital Cuts Celanese Price Target By 42% - Read Why