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On Friday, Baird initiated coverage on shares of Avient Corp. (NYSE:AVNT), a global provider of specialized and sustainable material solutions, with a Neutral rating and a price target of $43.00. The firm’s analyst, Ghansham Panjabi, noted that Avient is currently undergoing an organizational refocus under the leadership of a new CEO, which is expected to enhance the company’s financial performance. Trading near its 52-week low of $37.63, InvestingPro analysis suggests the stock is currently undervalued, with additional insights available through their comprehensive Pro Research Report.
Panjabi pointed out that Avient has set ambitious financial targets during its analyst day in December 2024, aiming to improve on its mixed 10-year earnings per share (EPS) compound annual growth rate (CAGR) of approximately 4%. The company has demonstrated consistent financial strength, maintaining dividend payments for 15 consecutive years and achieving a 3.11% revenue growth in the last twelve months. Despite the potential for improved financial metrics, Baird’s current investment strategy favors more defensive positions within their coverage universe, leading to their decision to start Avient with a Neutral stance.
The $43.00 price target set by Baird is based on approximately 15 times Baird’s estimated EPS for Avient in 2025, which stands at $2.85. This valuation reflects the firm’s expectations for Avient’s earnings potential over the next year. InvestingPro data shows the company currently trades at a P/E ratio of 21.28, with analysts forecasting EPS of $2.84 for FY2025.
Avient Corporation has been working to position itself more favorably in the market through strategic initiatives and leadership changes. The company is known for its commitment to sustainability and innovation within the materials science industry.
Investors and market watchers will be closely monitoring Avient’s progress as the company continues to implement its refocus strategy and strives to meet the financial objectives it laid out to the analyst community. The Neutral rating from Baird suggests a wait-and-see approach, as the company’s efforts to catalyze growth are still in the early stages.
In other recent news, Avient Corporation reported its fourth-quarter earnings for 2024, with an earnings per share (EPS) of $0.49, meeting analyst expectations. The company generated $747 million in revenue, slightly below the forecasted $755.91 million. Despite the revenue miss, Avient’s stock rose in premarket trading, reflecting investor optimism driven by robust full-year guidance and strategic innovations. Seaport Global Securities upgraded Avient’s stock rating to Buy, citing positive organic growth and strategic alignment with long-term financial targets. Meanwhile, Oppenheimer adjusted Avient’s price target to $54.00 from $56.00, maintaining an Outperform rating despite a slight miss in full-year 2025 guidance due to a foreign exchange headwind. Avient is also transitioning its enterprise resource planning system, leading to around $75 million in mostly non-cash charges for the year, but cash flow is anticipated to focus on reducing debt. The company’s guidance for 2025 projects adjusted EPS growth of 11% and adjusted EBITDA between $540 million and $570 million, underscoring a focus on margin expansion and organic growth.
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