Our EquityAnalytics department is always updating price targets and ratings on companies that we cover based on new information. Our price targets and ratings are thoroughly researched and use financial analysis tools to determine stock prices. Today we are updating the following companies from our coverage: Albemarle (ALB), Ashland (ASH), Celanese (CE), Dupont (DD), and Sociedad Quimica y Minera (SQM).
The chart below shows new ratings, price targets, and buy/sell ranges vs. old ones:
Click to enlarge.
Albemarle: Maintain At Hold, Decrease PT From $57 To $55
Not a ton has happened since our last update of Albemarle, but we dropped the price slightly from our latest update as shares outstanding increased slightly. We lowered some of our targets further out past this year as the issues in Europe are looking more grave since our last report. Albemarle does a good deal of business in Europe, and we believe the cyclical nature of the business may be a bit more weak moving forward in 2013. We now have flat growth expected for 2012 and 2013.
Ashland: Maintain At Hold, Maintain PT At $72
Nothing has changed for Ashland since our last update. We believe the company will be a solid Buy on any dip. The company is one of our favorite growth stocks in the industry. We are also fond of the company's ability to maintain solid margins. Specialty chemicals have less cyclicality. Additionally, the company performs a large portion of its business in automotive chemicals, which are a very strong chemical division right now.
Celanese: Maintain At Hold, Maintain PT At $47
Nothing has changed for Celanese as well. We like the company due to its higher margins, but it is another name that is subject to heavy cyclicality in the chemical industry. We continue to like Celanese on any weakness, and we see it as a Hold at current levels.
Dupont: Maintain At Hold, Decrease PT From $54 to $53
We maintain the Hold on Dupont, and we decreased the PT slightly as capital expenditures appear to be coming in a bit higher than we anticipated. We also increased the WACC a bit as net debt dropped somewhat. The move was very slight, and we think that Dupont is a solid company. We prefer other companies in the industry that offer better growth models and more specialized chemicals. We would buy Dupont on a dip to the mid-$40s.
Sociedad Quimica y Minera: Downgrade From Buy To Hold, Decrease PT From $84 to $60
We dropped our price target significantly on Sociedad Quimica y Minera as we increased the discount rate on the company because the beta has increased significantly on the company. Due to this, we had to discount it at a higher rate than we did last time we did the price target on the company. We believe that Sociedad Quimica y Minera is a great growth story as it owns a significant portion of natural resources in Chile. While we do like the company's growth story, we believe that the stock now needs to be discounted at a higher rate as beta has increased and the company is very tied to the growth in Chile.