Eastman increases prices of copolyesters
On March 2, 2017, Eastman Chemical (EMN) announced an increase in the prices of copolyesters. EMN increased copolyester prices by 0.21 euros and $0.22 per kilogram in the Europe and the Middle East and African regions. Further, EMN increased the prices of copolyesters by $0.15 per kilogram in the North America, Latin America, and Asia-Pacific regions. The price increase will be effective beginning April 1, 2017. The price hikes were mainly driven by increased market demand and a rise in raw material costs.
The price hike could impact EMN’s revenue positively in 2Q17 provided the volumes aren’t affected adversely. However, since the price rise was driven by the increase in raw material prices, we can also expect an increase in the cost of goods sold as well.
Eastman Chemical’s stock price
For the week ended March 3, 2017, EMN closed at $80.35 and rose 0.2% for the week. EMN’s stock price traded 6.9% above the 100-day moving average price of $75.18, indicating an upward trend in the stock. On a year-to-date basis, EMN has moved up 6.8%. EMN’s 14-day relative strength index (or RSI) of 56 indicates that the stock is neither overbought nor oversold. An RSI of 70 indicates that the stock is overbought and a score of 30 suggests that the stock is oversold. EMN’s 52-week low is $62.70, and its 52-week high is $82.10.
EMN underperformed the Guggenheim S&P 500 Equal Weight Materials ETF (RTM), which rose 0.9% for the week ended March 3, 2017. RTM invests 4.1% of its portfolio in Eastman Chemical. The top holdings of the fund include CF Industries (CF), Newmont Mining (NEM), and Sherwin-Williams (SHW), which have weights of 4.5%, 4.3%, and 4.4%, respectively, as of March 3, 2017.