Goldman Sachs Upgrades Chemours On Improving End Markets

Chemours Co.’s CC near-term prospects are now brighter, driven by TiO2 cycle improvement and growth in the Fluoroproducts business due to a cyclical recovery and secular trends, according to Goldman Sachs.

The Chemours Analyst: Robert Koort upgraded the rating for Chemours from Neutral to Buy, while raising the price target from $35 to $47.

The Chemours Thesis: The TiO2 cycle is improving with the industry’s efforts to stabilize pricing and “pigment prices are now set to increase for the first time in more than two years,” Koort said in the upgrade note.

“While risks associated with environmental liabilities could remain an overhang, CC’s recent agreement with DD/CTVA to share up to $4bn of liabilities over the next 20 years effectively provides CC access to $2bn funds that CC did not previously have,” the analyst wrote.

“Although tailwinds for CC are becoming stronger, we believe CC’s share price does not fully reflect the underlying earnings power of the business as the TiO2 cycle inflects and Fluoroproducts growth begins to reappear,” he added.

CC Price Action: Shares of Chemours had risen by 3.94% to $38.27 at the time of publication Wednesday.

(Photo by Alex Kondratiev on Unsplash)