Morgan Stanley Reports Long Term Opportunity In Acetylated Wood For Eastman Chemical

In a report published by Morgan Stanley, Eastman Chemical EMN has a long term opportunity on acetylated wood.

Morgan Stanley said that the gap between our estimates and consensus has narrowed 10-15% since Eastman's investor day, but the shares have de-rated due to the current volatile markets. “Our forecasts are still a further 5-10% ahead of consensus. With the shares trading on 9.6x 2012e P/E, and 21% upside to our $112 price target, we view the recent weakness in the shares as a buying opportunity. Within this report, we provide a deeper look into the acetylated wood technology that Eastman unveiled at its investor day. While the business of treating wood may not initially seem to fit in Eastman's existing portfolio, we believe it is an attractive opportunity for the company and will help drive growth in the outer years.”

Eastman Chemical closed yesterday at $92.49.