Investing.com -- Mizuho Securities upgraded Eastman Chemical (NYSE:EMN) Co to "Outperform" from "Neutral," citing stronger earnings momentum and a unique position in circular plastics.
The firm set a price target of $105, which roughly implies an 18% upside.
“Forward earnings for EMN have been rolling higher in recent quarters,” analyst at Mizuho said.
Unlike many basic chemical stocks, Eastman has seen forward earnings rise in recent quarters. The company benefits from a strong U.S. cost advantage, with 80% of its assets in the U.S. and a highly diversified downstream portfolio.
Mizuho expects Eastman to continue outperforming its peers on earnings.
The company exceeded December-quarter expectations and maintained its 2025 guidance. With limited exposure to China and expected tariffs, Eastman stands out in a sector facing downward estimate revisions.
“EMN has relatively little China competition, relatively little direct exposure to expected tariffs on a combined basis, less than 20% of EMN's sales are in China, Mexico and Canada, and has what appears to be a clearer path to profitability in circular plastics,” analyst added.
The firm also highlighted Eastman’s leadership in circular plastics, which is shifting from startup losses to profitability. By 2030, circular plastics could account for nearly 20% of total company EBITDA.
Mizuho values Eastman at 11.3 times its estimated future earnings, in line with its five-year average. The firm sees the stock as undervalued, with no current premium for its circular plastics business.
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