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Methanex (MEOH) Q3 Earnings Lag Estimates, Revenues Up Y/Y

Methanex CorporationMEOH recorded profit (attributable to Methanex shareholders) of $128 million or $1.61 per share in the third quarter of 2018. The figure improved around four-fold from $32 million or 38 cents a year ago and also from a profit of $111 million or $1.36 in the previous quarter.

Adjusted earnings per share (barring one-time items) in the quarter were $1.92. It missed the Zacks Consensus Estimate of $1.99.

Adjusted EBITDA of the chemical maker in the quarter was $293 million compared with $143 million in the prior-year quarter.

Revenues increased roughly 45% year over year to $1,044 million in the third quarter. The company gained from higher m ethanol prices and demand in the quarter.

Production in the third quarter totaled 1,735,000 tons compared with 1,765,000 tons a year ago.

Average realized price for methanol was $413 per ton in the reported quarter, up from $307 per ton a year ago and $405 per ton in the preceding quarter.

Methanex Corporation Price, Consensus and EPS Surprise

Methanex Corporation Price, Consensus and EPS Surprise | Methanex Corporation Quote

Financials

Cash flow from operating activities in the reported quarter was $228 million compared with $119 million in the prior-year quarter. Cash and cash equivalents were $261 million at the end of the quarter, down 15% year over year.

Outlook

Methanex recently completed the restart of its Chile IV plant and produced first methanol from the 0.8-million ton plant that has been idle since 2007. The Argentine Government has also recently granted permits for export of natural gas from Argentina to Chile. Methanex has started receiving natural gas from Argentina.

With a committed revolving credit facility, strong balance sheet and healthy cash generation capability, the company believes that it is well positioned to meet its financial commitments, execute growth opportunities and return excess cash to shareholders through dividends and share repurchases.

Price Performance

Shares of Methanex have moved up 25.6% over a year against the industry 's fall of 22.2%.

Zacks Rank & Other Stocks to Consider

Methanex sports a Zacks Rank #1 (Strong Buy).

Some other top-ranked stocks in the basic material space are CF Industries Holdings, Inc. CF , KMG Chemicals, Inc. KMG and The Mosaic Company MOS .

CF Industries has an expected long-term earnings growth rate of 6% and a Zacks Rank #1. The company's shares have gained 18.2% in the past year. You can see the complete list of today's Zacks #1 Rank stocks here.

KMG Chemicals has an expected long-term earnings growth rate of 28.5% and a Zacks Rank #1. Its shares have risen 35.8% in a year's time.

Mosaic has an expected long-term earnings growth rate of 7% and a Zacks Rank #2 (Buy). The company's shares have rallied 39.5% in the past year.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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