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Investing.com - BMO Capital lowered its price target on Celanese (NYSE:CE) to $47.00 from $55.00 on Thursday, while maintaining a Market Perform rating on the chemical company’s stock. According to InvestingPro data, the stock appears undervalued based on its Fair Value analysis, with shares down over 66% in the past year.
The firm cited renewed pressures across Celanese’s business segments, particularly noting weakness in key end markets including China and European automotive sectors, as well as the U.S. acetic acid market. The company’s current ratio of 2.05 indicates strong liquidity, though revenue declined by 5.8% in the last twelve months.
BMO acknowledged that Celanese’s risk profile has improved compared to 6-9 months ago, with solid free cash flow in the first half of 2025 and a pending asset sale in the works. The company maintains an impressive 11% free cash flow yield and has sustained dividend payments for 21 consecutive years.Get access to 10+ additional InvestingPro Tips and comprehensive analysis for Celanese in the Pro Research Report.
Despite ongoing self-help measures and cost reduction efforts by the company, BMO indicated that Celanese faces a challenging path to earnings growth given the current market conditions, prompting the downward revision in price target.
The research firm suggested that CEO Richardson had set a low bar for third-quarter expectations, potentially positioning the company to continue its "winning streak" of meeting or exceeding guidance, and characterized Wednesday’s stock selloff as potentially overdone.
In other recent news, Celanese Corporation reported its second-quarter earnings for 2025, surpassing analyst expectations with an earnings per share of $1.44, compared to the forecasted $1.40. Revenue also exceeded predictions, reaching $2.53 billion against an anticipated $2.5 billion. Despite these positive financial results, the company faces challenges with demand across key segments, affecting investor sentiment. KeyBanc recently lowered its price target for Celanese to $70, citing weak demand during June and July, although it maintained an Overweight rating due to successful cost management. Similarly, BofA Securities reduced its price target to $59, highlighting deteriorating demand and shortened order books, while maintaining a Buy rating. CFRA took a more cautious approach, lowering its target to $30 and maintaining a Sell rating, pointing to high debt levels and tariff concerns impacting demand. These developments reflect ongoing challenges for Celanese amid a difficult market environment.
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