Eastman ChemicalEMN said that it is expanding its production capacity for Avra Performance Fibers. The additional capacity will be located at the Unifi Manufacturing plant in Yadkinville, NC.
Construction work at the plant is complete and the company is making progress with plans to start up the new lines this month. The added capacity will be utilized to meet current and expected demand in the performance apparel market in North America.
Avra, which is based on Eastman Chemical's proprietary spinning technology, is a family of performance fibers. The company launched the product in Aug 2016. The performance benefits imparted by Avra fibers include exceptional moisture management. Fabrics made with Avra dry quickly - up to 50% faster than traditional polyester fabrics. This helps wearers stay cooler and more comfortable during demanding physical activities.
Avra fibers are being made in the U.S. in collaboration with Unifi, Inc., a multi-national textile manufacturing company. The collaboration has allowed a physical plant expansion at Unifi and provided additional jobs to the region. The combination of Eastman Chemical's novel spinning technology and Unifi's fiber manufacturing expertise is expected to keep the industry well supplied with Avra fibers this year and beyond.
Eastman Chemical has outperformed the Zacks categorized Chemicals-Diversified industry over the past three months, partly attributable to its forecast-topping earnings performance in third-quarter 2016. The company's shares have gained around 24% over this period, compared with roughly 11.9% gain recorded by the industry. Eastman Chemical gained from its cost-reduction actions and strong growth of its high value products in the third quarter.
Eastman Chemical remains focused on cost cutting and productivity actions amid a still challenging operating environment. It also remains committed to cut debt and enhance shareholder returns leveraging healthy free cash flows. The company is also gaining from synergies of acquisitions, especially Taminco Corporation.
However, Eastman Chemical is faced with significant pricing and competitive pressures. Moreover, challenging global economic conditions are affecting demand for some of the company's products. The company also faces currency translation risk.
Eastman Chemical currently carries a Zacks Rank #3 (Hold).
Eastman Chemical Company Price
Other Stocks to Consider
Better-ranked companies in the chemical space include The Chemours Company CC , Kronos Worldwide, Inc. KRO and Methanex Corporation MEOH all holding a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
Chemours has an expected earnings growth of around 60.1% for the current year.
Kronos has an expected earnings growth of around 261.5% for the current year.
Methanex has an expected long-term growth of around 15%.
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