Is this U.S.-China selloff a buy? A top Wall Street voice weighs in
Investing.com - BMO Capital raised its price target on Ecovyst Inc. (NYSE:ECVT) to $14.00 from $10.00 on Thursday, while maintaining an Outperform rating following the company’s announcement of a significant divestiture. The stock has shown strong momentum, gaining nearly 37% over the past six months and currently trading near its 52-week high of $9.31, according to InvestingPro data.
Ecovyst has reached an agreement to sell its entire Advanced Materials & Catalysts (AM&C) business for $556 million, representing 9.8 times the division’s 2024 EBITDA, with expected net proceeds of approximately $530 million.
The transaction removes what BMO Capital describes as Ecovyst’s "more volatile business" while streamlining the company’s overall portfolio, achieved at what the research firm characterizes as a "chunky valuation."
BMO Capital notes the sale provides Ecovyst with significant cash that can be used to reduce debt and return capital to shareholders.
The research firm suggests the transaction demonstrates that Ecovyst is undervalued by both public and potentially private investors, which BMO believes should drive the stock price higher.
In other recent news, Ecovyst Inc. reported its second-quarter 2025 earnings, surpassing expectations with an earnings per share of $0.12, compared to the forecasted $0.10. However, the company’s revenue fell short of projections, coming in at $200.1 million against an expected $204.61 million. Additionally, Ecovyst has entered into a definitive agreement to sell its Advanced Materials & Catalysts segment to Technip Energies for $556 million. This transaction is valued at a 9.8x EBITDA multiple based on the segment’s projected 2024 performance. The deal is anticipated to close in the first quarter of 2026, pending regulatory approvals and customary closing conditions. The Advanced Materials unit, a leader in specialty catalysts and advanced materials, employs approximately 330 people and operates three manufacturing facilities in the United States and Europe. These developments reflect significant strategic moves by Ecovyst as it navigates its future business landscape.
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