Eastman Chemical Announces $300M Share Buyback - Analyst Blog
May 06 2013 - 8:50AM
Zacks
Eastman Chemical
Company’s (EMN) Board has approved an increase in its
share repurchase authorization by up to an additional $300 million
of Eastman Chemical common stock. This is in addition to the amount
remaining under the existing $300 million of share repurchases
authorized in Feb 2011.
Eastman Chemical expects to fund
the share buyback through a combination of available cash on hand
and purchases made from time to time in either the open market or
private transactions. Decisions regarding the timing, quantity, and
nature of share repurchases will be exclusively made by management,
depending on the prevailing market conditions, applicable
securities laws and other relevant factors.
The moves adopted by Eastman
Chemical testify its commitment to boost shareholders’ value while
retaining its strong financial position. The company bought back
shares worth $32 million in the most recent quarter.
Last month, Eastman Chemical posted
its first-quarter 2013 adjusted earnings (from continuing
operations) of $1.62 per share. The adjusted earnings exclude costs
related to the acquisition of Solutia Inc. as well as restructuring
and impairment charges.
Eastman Chemical reported a profit (from continuing operation) of
$247 million or $1.57 a share, a 55% year-over-year surge. The
bottom line was boosted by a healthy rise in revenues.
Revenues surged roughly 27% year
over year to $2,307 million. The top line was driven by strong
gains across the Additives and Functional Products and Advanced
Materials divisions and the contributions of the Solutia
acquisition.
Eastman Chemical feels that its
strong foothold in key markets, vast geographic presence and
diversified end markets will help it to deliver strong earnings.
However, uncertainty regarding the timing of a recovery in Europe
and volatility in raw material and energy costs remain as
overhangs.
Eastman Chemical currently holds a
Zacks Rank #3 (Hold).
Other companies in the chemical industry that are worth considering
include Shin-Etsu Chemical Co., Ltd. (SHECY),
Celanese Corporation (CE) and Methanex
Corporation (MEOH). While Shin-Etsu Chemical retains a
Zacks Rank #1 (Strong Buy), both Celanese and Methanex hold a Zacks
Rank #2 (Buy).
CELANESE CP-A (CE): Free Stock Analysis Report
EASTMAN CHEM CO (EMN): Free Stock Analysis Report
METHANEX CORP (MEOH): Free Stock Analysis Report
SHIN-ETSU CHEM (SHECY): Get Free Report
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