Update shared on 09 Dec 2025
Analysts have modestly trimmed their price target on Eastman Chemical by about $2 per share to approximately $74, citing a still challenging macro backdrop but highlighting improving 2026 earnings visibility driven by cost savings, asset utilization tailwinds, and the company’s ability to sustain solid free cash flow through the current earnings trough.
Analyst Commentary
Recent Street commentary reflects a generally constructive stance on Eastman Chemical, with price targets clustered in the low to mid 70s and Buy ratings maintained even as estimates and targets are adjusted to reflect a tougher macro environment.
Bullish analysts emphasize that 2026 earnings visibility is improving as cost savings programs and an expected asset utilization ramp begin to layer in, supporting a view that earnings can inflect higher from 2025 onward, even if end markets remain sluggish.
More cautious voices acknowledge that while free cash flow remains solid through the current trough, mixed industrial demand and softer commodity trends limit near term upside and warrant tempered valuation expectations versus prior cycles.
As a result, the consensus narrative centers on disciplined execution and cash generation today, with the rerating potential tied to management’s ability to deliver on structural cost actions, drive higher utilization, and convert those gains into sustained earnings growth.
Bullish Takeaways
- Improving 2026 earnings visibility from cost savings and asset utilization initiatives supports the case for multiple stability in the low to mid 70s price target range.
- Maintaining solid free cash flow through the earnings trough underpins downside support for the equity and reinforces confidence in capital returns.
- Expectation that earnings can improve from 2025, even with only modest end market recovery, suggests operational self help could drive growth ahead of a full macro rebound.
- Reaffirmed Buy ratings alongside only incremental target changes signal that execution, not balance sheet or business model risk, is the key variable for upside.
Bearish Takeaways
- Lowered price targets reflect a less favorable macro backdrop, with inconsistent industrial demand and softer commodity trends constraining near term growth assumptions.
- Management’s focus on cash generation at the expense of near term profits may cap earnings momentum, limiting scope for a rapid valuation rerating.
- Recent slippage in commodity businesses following a stronger second quarter raises concern that margin recovery could be slower and more volatile than previously expected.
- Expectations for typical seasonal strength have been reset lower, reinforcing a cautious stance on short term volume and pricing trajectories.
What's in the News
- The board approves a quarterly dividend increase from $0.83 to $0.84 per share, payable January 8, 2026, underscoring management's confidence in cash generation (Dividend Increases).
- The company completes a major share repurchase tranche, buying back 776,977 shares in the latest quarter and 25.51% of shares since 2018 for a total of about $3.16 billion (Buyback Tranche Update).
- Eastman is removed from the S&P 500 and associated sector and style subindices, with concurrent addition to the S&P 600 and S&P 1000, signaling a shift in its index footprint toward small-cap benchmarks (Index Constituent Drops and Adds).
- The company is dropped from the FTSE All World Index, further reducing representation in major global equity benchmarks (Index Constituent Drops).
- Eastman and Toly launch the Gemini cosmetics compact using Cristal One Renew IM812, a high-clarity, fully recyclable PET material with up to 100% certified recycled content, targeting premium beauty brands with a sustainability focus (Strategic Alliances).
Valuation Changes
- Fair Value: Unchanged at approximately $72.76 per share, indicating a stable intrinsic valuation despite macro headwinds.
- Discount Rate: Fallen slightly from about 8.85% to roughly 8.79%, reflecting a modestly lower perceived risk profile or cost of capital.
- Revenue Growth: Edged down marginally from about 1.30% to roughly 1.28%, signaling slightly more conservative top line expectations.
- Net Profit Margin: Risen fractionally from about 9.19% to roughly 9.20%, pointing to a small improvement in projected profitability.
- Future P/E: Declined very slightly from about 11.97x to roughly 11.95x, suggesting a near flat valuation multiple on forward earnings.
Have other thoughts on Eastman Chemical?
Create your own narrative on this stock, and estimate its Fair Value using our Valuator tool.
Create NarrativeDisclaimer
AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.