BofA Securities analyst Steve Byrne said he was bullish on commodity chemical stocks but remained selective given a tough recovery and leans "this way with lithium, as well."
The analyst expected residential and non-resi investments to remain soft, with more resilience in aerospace and auto and a continued focus on decarbonization and water management.
Consequently, the analyst issued an upgrade for Dow Inc
On the other hand, the analyst gave Celanese Corporation
Apart from this, the analyst stated the agricultural (ag) markets are entering normalized earnings at a lower part of the cycle, with farmer margins expected to be flat Y/Y in 2024 but still above pre-2021 levels.
As the outlook for crop chemicals remains sluggish, the analyst downgraded FMC Corp
Among the other petrochemical/diversified companies, the analyst lowered the rating on DuPont de Nemours Inc
Meanwhile, the analyst issued an upgrade for Ecolab Inc
Overall, for U.S/ chemicals stocks, the analyst moderately reduced the earnings estimates, with EPS lowered by an average of 3% for the fourth quarter of FY23 and 6% for FY24.