Wells Fargo upgrades Celanese stock rating on cost savings potential

Wells Fargo upgraded Celanese (NYSE:CE) from Equal Weight to Overweight on Monday, raising its price target to $66.00 from $45.00. The upgrade aligns with InvestingPro data showing 8 analysts recently revising their earnings estimates upward, with the company expected to return to profitability this year. The upgrade comes as the financial services firm sees potential for sequential earnings per share improvement.

The improved outlook is based on anticipated cost savings and reduced maintenance requirements, according to Wells Fargo. The firm’s analysis assumes no near-term demand improvement for the materials company.

Celanese stock has declined approximately 70% from its high of $171 recorded on April 3, 2024, compared to the S&P 500’s 15% decrease during the same period. The stock currently trades at 7.5 times mid-cycle EBITDA of $2.5 billion.

Wells Fargo’s new $66 price target represents approximately 9.5 times the expected 2025 EV/EBITDA ratio. This valuation equals 8 times both the mid-cycle EBITDA of $2.5 billion and the projected 2025 price-to-earnings ratio.

The materials company, which produces specialty chemicals and advanced materials, has faced significant market challenges over the past year despite its position in various industrial supply chains. With a market capitalization of $5.98 billion and annual revenue of $10.06 billion, Celanese maintains a solid market presence. Discover more detailed insights and 5 additional ProTips with InvestingPro’s comprehensive research report.

In other recent news, Celanese Corporation reported its first-quarter 2025 earnings, significantly surpassing analysts’ expectations with an earnings per share (EPS) of $0.57, compared to the forecasted $0.39. The company also exceeded revenue projections, posting $2.4 billion against an anticipated $2.26 billion. KeyBanc Capital Markets responded to these results by raising its price target for Celanese from $71.00 to $76.00, maintaining an Overweight rating on the stock. The firm highlighted the end of inventory reductions in the automotive sector and steady demand across healthcare, electronics, and industrial markets as positive indicators.

Additionally, BMO Capital Markets upgraded Celanese’s stock rating from "Underperform" to "Market Perform," raising the price target from $46.00 to $55.00. BMO Capital cited a more balanced risk-reward scenario due to easing tariff wars and potential benefits from near-term asset sales. In governance-related news, Celanese announced amendments to its corporate charter and bylaws, including the removal of supermajority voting requirements, following shareholder approval. These changes were detailed in a recent SEC filing.

Investors are also keeping an eye on Celanese’s strategic initiatives, such as divestitures and cost control measures, which are expected to impact its financial health and stock valuation. The company’s ability to outperform expectations amidst global market challenges reflects its strategic focus on high-impact programs and cost management.

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