Over the last year, Eastman Chemical Company logged a negative performance of -27.5%, with a high of $124.85 and a low of $69.91. During this time, the stock trailed the S&P 500 index by -16.2%. As of January 2023, the company's 50-day average price was $85.28. Eastman Chemical Company operates as a specialty materials company in the United States and internationally. Based in Kingsport, TN, the large-cap Basic Materials company has 14,000 full time employees. Eastman Chemical Company has provided a 3.4% dividend yield over the last 12 months.
Growing Revenues With Increasing Reinvestment in the Business:
| 2019-12-31 | 2020-12-31 | 2021-12-31 | |
|---|---|---|---|
| Revenue (MM) | $9,273 | $8,473 | $10,476 |
| Revenue Growth | n/a | -8.63% | 23.64% |
| Gross Margins | 24.1% | 23.3% | 23.9% |
| Gross Margins Growth | n/a | -3.32% | 2.58% |
| Operating Margins | 14.1% | 12.9% | 13.8% |
| Operating Margins Growth | n/a | -8.51% | 6.98% |
| Earnings Per Share | $5.48 | $3.5 | $6.25 |
| EPS Growth | n/a | -36.13% | 78.57% |
| Free Cash Flow (MM) | $1,079 | $1,072 | $1,041 |
| FCF Growth | n/a | -0.65% | -2.89% |
| Capital Expenditures (MM) | -$425 | -$383 | -$578 |
| Net Debt / EBITDA | 2.98 | 3.24 | 1.95 |
Eastman Chemical Company's Valuation Is in Line With Its Sector Averages:
Eastman Chemical Company has a trailing twelve month P/E ratio of 9.6, compared to an average of 8.57 for the Basic Materials sector. Based on its EPS guidance of 8.21, the company has a forward P/E ratio of 10.6.
The average annual growth rate of the company's historical and projected earnings per share is 24.67%. On this basis, the company's PEG ratio is 0.39. However, this growth rate is probably not sustainable. In its place we will use the broader market's estimated 5-year EPS growth rate of 13.05%, which gives us a PEG ratio of 0.74. Even with this more conservative assumption on EPS growth, the PEG ratio suggests that Eastman Chemical Company shares are underpriced.
The market is placing a reasonable value on Eastman Chemical Company's book value, since its P/B ratio of 1.9 is comparable to its sector average of 1.86. The company's shares are currently 21.5% above their Graham number, which implies that they are not trading at a fair value in terms of earnings and net assets.
There's an Analyst Consensus of Some Upside Potential for Eastman Chemical Company:
There are 22 analysts covering Eastman Chemical Company, with target prices ranging from $79 to $115 per share, for an average of $93.45. As of January 2023, the company is trading -6.88% away from its average target price, implying there is an analyst consensus of some upside potential. The average rating for Eastman Chemical Company is buy.
With a 1.4% short interest, Eastman Chemical Company has a very low short interest. Institutions own 87.8% of the company's shares, and it has a small amount of insider investors because 0.56% are owned by corporate insiders. Overall, the company's top shareholder is the Vanguard Group, Inc., whose 13% stake in the company is worth around $1,320,609,638.
delta22_3
