Truist cuts Chemours stock price target to $20, maintains Buy

On Monday, Truist Securities revised its price target for Chemours (NYSE:CC) shares, lowering it to $20 from the previous $22, while sustaining a Buy rating on the stock. The adjustment follows the company’s first-quarter earnings report for 2025. Currently trading at $11.06, the stock has seen significant pressure, down nearly 60% over the past year. According to InvestingPro analysis, Chemours appears slightly undervalued based on its Fair Value assessment.

The company’s Titanium Dioxide (TiO2) segment’s earnings in the first half are reportedly below the consensus estimates. However, Chemours anticipates an increase in earnings for this segment throughout the year, driven by cost reductions expected to take greater effect in the second half. InvestingPro data shows that while the company operates with a significant debt burden, with a debt-to-equity ratio of 7.57, its net income is expected to grow this year. Get access to 12 more exclusive ProTips and comprehensive financial analysis through InvestingPro’s detailed research reports.

Chemours has also seen continued success with its Opteon product line, which has maintained impressive margins above 30%. Additionally, the company is making strides towards the commercialization of its data center cooling product.

Despite the recent announcement of a dividend cut to a 3.16% yield, Truist Securities notes that Chemours is projecting a return to positive free cash flow (FCF) in the second quarter and anticipates this trend to persist for the rest of the year. The company’s current free cash flow yield stands at -48%, reflecting recent challenges. Discover more detailed insights and financial metrics with InvestingPro’s comprehensive research reports, available for over 1,400 US stocks. The firm’s analyst, Peter Osterland, emphasized the company’s expected financial improvement, stating, "We have updated our estimates for CC post-1Q25 earnings and maintain our Buy rating, lowering our price target to $20 from $22. While 1H earnings for TiO2 are tracking below consensus, CC does expect full year earnings growth for the segment as cost cuts kick in more significantly in 2H. Opteon growth continues to be a standout, with TSS margins poised to continue in the 30%+ range this year, and what appears to be continued progress readying the company for commercialization of its data center cooling product. While we believe the announced dividend cut has been a focus, we note CC does expect a return to positive FCF in 2Q and through the remainder of the year."

In other recent news, Chemours reported its Q1 2025 financial results, revealing earnings per share (EPS) of $0.13, which fell short of the forecasted $0.23. The company achieved revenue of $1.37 billion, slightly surpassing expectations of $1.36 billion. Despite the revenue beat, the earnings miss led Jefferies analyst Laurence Alexander to reduce Chemours’ stock price target from $20.00 to $11.50, while maintaining a Hold rating. Alexander noted that supply chain disruptions pose near-term challenges, but highlighted potential growth areas such as the data center liquid cooling market.

Chemours has entered into a strategic agreement with Navin Fluorine International Ltd. to manufacture Opteon™, a cooling fluid for data centers, aiming to address the growing demands of AI technologies. This partnership is expected to commence in 2026 and focuses on sustainable solutions with a low global warming potential. Meanwhile, Chemours has also reduced its dividend by 65% to enhance balance sheet flexibility. The company remains optimistic about its strategic initiatives, including the focus on titanium dioxide and thermal solutions, despite facing macroeconomic headwinds.

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