Celanese (CE) PT Lowered to $60 at UBS

UBS analyst Joshua Spector lowered the price target on Celanese (NYSE: CE) to $60.00 (from $72.00) while maintaining a Neutral rating.

The analyst commented, "While 4Q results were better than expectations, a more challenging 1H leads to an even slower recovery than we expected. There are a number of additional 1-time items impacting 1Q which makes it unusually low, but even adding this back to 2Q gets to a quarterly EPS run-rate that is ~30% below our prior expectations. We do expect there is some conservatism baked into the back end of 1H25, but it is hard for us to gain conviction in a recovery in earnings power at this point. We lower our 2025/26 EPS 27-32%, and this lower earnings level means that leverage stays higher for longer. We model 2025 at >5x EBITDA, and declining to the low-4s in 2026, but requires a step up in earnings to achieve that. CE has raised its leverage ceiling w/ lenders, so there isn't an immediate covenant risk, but there are still questions on funding for debt repayment looking 1-2 years out. CE's new CEO (& associated mgmt/board changes) stressed a renewed sense of urgency to improve FCF and address leverage (continues to look at divestments). However, with so much uncertainty on earnings power, and overhang with higher leverage, it is too early for us to get constructive."

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