Eastman Chemical (EMN) AI Stock Analysis

• Market Cap: $8.90B
• Dividend Yield: 4.31%
• Average Volume (3M): 1.83M
• Price to Earnings (P/E): 9.8
• Beta (1Y): 0.95
• Revenue Growth: 2.78%
• EPS Growth: 1.50%
• Country: US
• Employees: 14,000
• Sector: Basic Materials
• Sector Strength: 68
• Industry: Chemicals - Specialty
• EPS (TTM): 1.91
• Shares Outstanding: 115,460,150
• 10 Day Avg. Volume: 1,742,095
• 30 Day Avg. Volume: 1,826,556
• PEG Ratio: -1.78
• Price to Book (P/B): 2.16
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 31.67
• Enterprise Value/Market Cap: 1.77
• Enterprise Value/Revenue: 0.40
• Enterprise Value/Gross Profit: 6.73
• Enterprise Value/Ebitda: 2.24
• 1Y Price Target: $96.07
• Price Target Upside: 27.80% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 14

• Rating: 68 Neutral
• Price Target: $87.00 ▲(15.74%Upside)

Eastman Chemical's overall stock score reflects strong financial performance and a favorable valuation, despite mixed technical indicators and challenges highlighted in the earnings call. The company's profitability and operational efficiency are strengths, while economic uncertainties and tariff impacts pose risks.

Positive Factors

Cost savings

Cost cutting is expected to generate $75m in net savings.

Financial resilience

The company has one of the best balance sheets in the group with net debt/EBITDA expected to remain at 2.4x by year-end.

State incentives

EMN received $70MM in incentives from the State of Texas.

Negative Factors

Loss of funding

Eastman has lost its $375 million grant from the Department of Energy associated with the thermal energy/battery aspect of its Longview, Texas molecular recycling facility.

Lower demand

CapEx is higher versus 2021 and demand is lower, so there are no doubt issues to work through.

Soft end-market demand

Demand from auto, consumer durable, and construction end markets likely remains soft through the end of the year.

Eastman Chemical Business Overview & Revenue Model

Company Description

Eastman Chemical Company (EMN) is a global specialty materials company that produces a broad range of advanced materials, chemicals, and fibers. The company operates through several segments, including Additives & Functional Products, Advanced Materials, Chemical Intermediates, and Fibers. Eastman Chemical serves diverse markets such as transportation, building and construction, consumables, and textiles, providing innovative solutions that enhance the performance and functionality of its customers' products.

How the Company Makes Money

Eastman Chemical makes money primarily through the production and sale of specialty chemicals and advanced materials. The company's revenue model is based on its diversified product portfolio and its ability to serve a wide array of industries. Key revenue streams include sales from the Additives & Functional Products segment, which offers chemicals that improve the performance of products in industries like automotive and agriculture; the Advanced Materials segment, which provides high-performance polymers and films; and the Chemical Intermediates segment, which supplies raw materials for industrial processes. Eastman's Fibers segment also contributes to revenue through the production of cellulose acetate fibers used in textile and cigarette applications. Significant partnerships and customer relationships across diverse industries, as well as a focus on innovation and sustainability, further drive Eastman's earnings.

Eastman Chemical Financial Statement Overview

Summary

Eastman Chemical displays strong profitability and operational efficiency, supported by healthy profit margins and a balanced capital structure. The company demonstrates effective use of equity to generate returns, although a slight revenue decline and free cash flow contraction highlight areas for improvement. Maintaining revenue growth and enhancing cash generation will be crucial for sustaining financial health and supporting future investments.

Income Statement

Eastman Chemical's TTM (Trailing-Twelve-Months) gross profit margin stands at 25.06%, indicating solid profitability. The net profit margin is 9.85%, which reflects consistent earnings relative to revenue. Although the revenue has slightly declined by 0.25% from the previous year, the EBIT and EBITDA margins remain strong at 15.30% and 18.84% respectively. These figures suggest effective cost management and operational efficiency. However, the slight revenue decline is a concern that could impact future profitability if not addressed.

Balance Sheet

The company's debt-to-equity ratio is 0.86, which indicates a balanced capital structure with a manageable level of debt. The return on equity (ROE) is 15.70%, reflecting effective use of shareholders' capital to generate profits. Additionally, the equity ratio is 39.22%, suggesting a strong equity position relative to total assets. Overall, the balance sheet demonstrates financial stability with room for leveraging opportunities if needed.

Cash Flow

Eastman Chemical's TTM operating cash flow to net income ratio is 1.23, showing strong cash conversion from profits. The free cash flow to net income ratio is 0.62, indicating a solid ability to generate cash after capital expenditures. However, the free cash flow growth rate declined by 16.28% from the previous period, suggesting potential challenges in maintaining cash reserves. The company needs to focus on improving its free cash flow generation to ensure long-term financial flexibility.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
9.36B	9.38B	9.21B	10.58B	10.48B	8.47B
	Gross Profit
2.35B	2.29B	2.06B	2.14B	2.50B	1.98B
	EBIT
1.43B	1.30B	1.09B	1.25B	1.88B	968.00M
	EBITDA
1.88B	1.80B	1.81B	1.73B	2.42B	1.54B
	Net Income Common Stockholders
922.00M	905.00M	894.00M	793.00M	857.00M	478.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
418.00M	837.00M	548.00M	493.00M	459.00M	564.00M
	Total Assets
14.97B	15.21B	14.63B	14.67B	15.52B	16.08B
	Total Debt
5.02B	5.02B	4.97B	5.15B	5.16B	5.62B
	Net Debt
4.60B	4.18B	4.42B	4.66B	4.70B	5.05B
	Total Liabilities
9.03B	9.36B	9.10B	9.43B	9.73B	9.97B
	Stockholders Equity
5.87B	5.78B	5.46B	5.15B	5.70B	6.02B
Cash Flow		Free Cash Flow
576.00M	688.00M	541.00M	351.00M	1.04B	1.07B
	Operating Cash Flow
1.14B	1.29B	1.37B	975.00M	1.62B	1.46B
	Investing Cash Flow
-486.00M	-534.00M	-432.00M	392.00M	-29.00M	-394.00M
	Financing Cash Flow
-726.00M	-454.00M	-888.00M	-1.32B	-1.69B	-704.00M

Eastman Chemical Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 75.17
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EMN, the sentiment is Negative. The current price of 75.17 is below the 20-day moving average (MA) of 79.02, below the 50-day MA of 77.96, and below the 200-day MA of 92.01, indicating a bearish trend. The MACD of -0.71 indicates Positive momentum. The RSI at 39.71 is Neutral, neither overbought nor oversold. The STOCH value of 7.08 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for EMN.

Eastman Chemical Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EMN	68 Neutral	$8.90B	9.81	16.16%	4.31%	2.78%	1.50%
SQM	66 Neutral	$9.27B	15.24	12.17%	0.47%	-28.74%	53.25%
AVTR	66 Neutral	$9.15B	12.55	12.52%	―	-2.64%	173.69%
WLK	60 Neutral	$9.80B	25.70	3.71%	2.75%	-1.27%	48.34%
PPG	58 Neutral	$24.75B	18.47	18.47%	2.49%	-7.67%	-0.58%
ALB	56 Neutral	$7.17B	―	-10.58%	2.66%	-39.34%	-500.52%
Sector *	51 Neutral	$2.03B	-1.27	-21.09%	4.14%	2.90%	-30.49%

Eastman Chemical Corporate Events

Eastman Chemical Announces Leadership Transition Plan

In January 2025, Eastman Chemical‘s Steve Crawford transitioned to Executive Vice President, Methanolysis Operations and Worldwide Engineering and Construction Transformation to oversee the Kingsport Methanolysis facility’s startup. With the successful completion of this project, the company decided to eliminate his position as part of succession planning, effective June 2, 2025. Crawford’s responsibilities will be reassigned to other executives, and he will receive severance benefits for his 41 years of service.