Calumet (CLMT) Valuation in Focus After Zacks Strong Sell Downgrade and Mixed Analyst Ratings

Calumet (CLMT) faced fresh scrutiny after Zacks Research shifted its rating from hold to strong sell. This move followed the company’s quarterly earnings, which missed expectations. As a result, some market uncertainty arose and analyst opinions became more varied.

See our latest analysis for Calumet.

Calumet’s share price has shown signs of volatility this year, dropping over 16% year-to-date and closing at $18.28 after a modest rally of nearly 13% in the last three months. While the one-year total shareholder return is negative at -14.5%, long-term holders have still seen impressive gains, with shares up 434% over five years. This suggests momentum has cooled, but the longer-term trend remains positive for patient investors.

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Given this mix of recent downgrades and a lengthy run-up in share price, investors face a key question: Is Calumet now trading at a discount, or is the market already factoring in any future turnaround?

Most Popular Narrative: 4% Undervalued

Calumet’s most widely followed valuation narrative places its fair value at $19.05, a modest premium over the last close of $18.28. This suggests there is still some upside potential for the stock. The focus is on the company’s push into sustainable aviation fuel and specialty products as the foundation for future growth.

The MaxSAF 150 project is on track to start up in the first half of 2026. This will enable Calumet to produce 120-150 million annual gallons of sustainable aviation fuel (SAF) at relatively low capital costs, capturing premiums of $1-$2 per gallon over renewable diesel and tapping into surging mandated and voluntary SAF demand globally. This is likely to drive a material step-up in revenues and EBITDA margin expansion once operational.

Read the complete narrative.

Want to learn what gives this narrative its edge? The valuation hinges on a bold expansion strategy and financial projections that break from recent trends. Curious which assumptions make analysts believe Calumet can outpace market skepticism and reach a higher target? Find out what’s fueling the optimism.

Result: Fair Value of $19.05 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, heavy reliance on regulatory support and ongoing market volatility remain significant risks that could quickly challenge the positive outlook for Calumet’s future growth.

Find out about the key risks to this Calumet narrative.

Another View: Looking at Sales Ratios

While analysts see Calumet as slightly undervalued based on earnings potential, looking at its price-to-sales ratio tells a different story. The company trades at 0.4x sales, which is higher than the peer group but comfortably below the US Oil and Gas industry average of 1.5x. Notably, the fair ratio for Calumet is estimated at 0.5x. The market could be moving closer to this mark over time. But is that small gap a safety margin or a signal of limited upside?

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Calumet Narrative

If you want to dig deeper or have a different perspective, you can easily craft your own narrative from the data in just a few minutes, and Do it your way.

A great starting point for your Calumet research is our analysis highlighting 1 key reward and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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