Chemours stock rises on Mizuho upgrade

Investing.com -- Shares of Chemours (NYSE:CC) climbed 2% in after-hours trading following an upgrade by Mizuho (NYSE:MFG) analyst John Roberts from Outperform to Neutral, with a new price target set at $19.00. The positive market movement reflects investor sentiment buoyed by the analyst’s comments, which highlighted several stabilizing factors in the company’s operations.

Roberts pointed to the normalization of Freon-related inventories and the stabilization of specialty plastics as positive indicators for Chemours. Additionally, the expectation that per- and polyfluoroalkyl substances (PFAS) will remain below regulatory thresholds, coupled with the recent settling in of a new CEO and CFO, were seen as favorable developments for the chemical company’s outlook.

Chemours, a leading global producer of fluorine-based refrigerants and specialty plastics, as well as the second-largest global producer of titanium dioxide (TiO2) pigments, has faced challenges due to industry stockpiling and market softness. However, Roberts suggests that these conditions are improving. "The transition to NextGen refrigerants has been offset by industry stockpiling of Freon-related, which is normalizing," Roberts stated. He also noted that the low operating rates in China’s TiO2 expansion and the subsequent market collapse appear to have bottomed out.

The company’s position in the market is further supported by the lack of new near-term PFAS restrictions, as the new EPA chemicals lead is a former DuPont (NYSE:DD) executive. Roberts also mentioned the potential for a settlement before the anticipated New Jersey PFAS trial in the spring or summer, which could provide additional financial headroom under the sharing agreement with Chemours’ former parent companies.

In his comments, Mizuho analyst John Roberts said, "Freon-related inventories normalizing, specialty plastics stabilizing, PFAS expected below threshold, new CEO & CFO settled in. When it rains, it can pour. But, cloudbursts can be followed by sunshine."

Investors appear to respond to these insights with cautious optimism, as evidenced by the uptick in Chemours’ stock price. The company’s strategic positioning and the mitigation of previous market challenges present a potentially brighter future, aligning with the analyst’s metaphor of sunshine following a cloudburst.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.