CHICAGO, Jan. 13, 2014 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include the Chesapeake Energy Corp. (NYSE:CHK-Free Report), EOG Resources, Inc. (NYSE:EOG-Free Report), LyondellBasell Industries NV (NYSE:LYB-Free Report), OCI Partners LP (NYSE:OCIP-Free Report) and PPG Industries Inc. (NYSE:PPG-Free Report).
(Logo: http://photos.prnewswire.com/prnh/20101027/ZIRLOGO)
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
Here are highlights from Friday's Analyst Blog:
The Shale Advantage: 3 Chemicals Picks
According a report released by the American Chemistry Council (ACC), U.S. chemicals exports are poised to rise significantly in the near future. Exports have already increased in 2013, primarily due to a spurt in shale gas production.
A Spurt in Exports
According to the ACC, the industry association of chemicals producers, U.S. chemicals exports will increase 45% over the next five years. These exports will be made possible by investments which will substantially increase capacity.
In fact, such capacity has been created to cater to burgeoning export demand. From a net importer of chemicals in 2011, the U.S. has now become a major player in export markets. In 2013, net export value for chemicals was $2.7 billion. The ACC expects this figure to rise to $30 billion by 2018.
The ACC expects U.S. chemical production to increase by 2.5% in 2014 and 3.5% in 2015. Higher external demand for plastic resins and organic chemicals is also expected going forward, the ACC said.
The Shale Advantage
An increase in the production of shale gas and liquids is the primary reason for the resurgence of the U.S. chemicals sector. Affordable natural gas and ethane present U.S. producers with a compelling cost advantage over their global counterparts who use a more expensive, oil-based feedstock.
The ACC report indicates that over 50 projects worth $40 billion will be operational in the next few years. The leading players in the U.S. shale arena include Chesapeake Energy Corp. (NYSE:CHK-Free Report) and EOG Resources, Inc. (NYSE:EOG-Free Report).
3 Chemicals Picks
The increase in shale gas production has provided a boost to the entire chemicals sector. Below we present three companies gaining from the shale effect, each of which also have a good Zacks rank.
LyondellBasell Industries
LyondellBasell Industries NV (NYSE:LYB-Free Report) is a prominent plastics, chemical and refining company. The company said that it has restarted its methanol plant at Channelview, Texas, in fourth-quarter 2013 to benefit from low-cost natural gas from shale formations.
Methanol is used to make chemicals such as acetic acid and formaldehyde as well as several other products. Natural gas is a key feedstock for producing methanol.
LyondellBasell holds a Zacks Rank #2 (Buy) and has expected earnings growth of 17.50%. The forward price-to-earnings Ratios (P/E) for the current financial year (F1) is 11.24.
OCI Partners
OCI Partners LP (NYSE:OCIP-Free Report) was hived off in early 2013 from OCI NV, which is a Netherlands based construction contractor and fertilizer producer. The company produces methanol and ammonia at an integrated plant at Beaumont. The facility enjoys a strategic location on the Texas Gulf Coast.
Currently, the company produces 730,000 metric tons of methanol and 265,000 metric tons of ammonia per year. In late 2013, the company said it was setting up a plant which will produce 5,000 metric tons of methanol per day.
OCI believes that when completed in 2016, this will be the largest methanol producing facility in the U.S. Currently the company holds a Zacks Rank #2 (Buy) and has expected earnings growth of 8.80%. It has a P/E (F1) of 11.80.
PPG Industries
Ourthirdchoice isPPG Industries Inc. (NYSE:PPG-Free Report). The company supplies protective and decorative coatings worldwide. It operates across several business segments. These include performance, architectural and industrial coatings.
Following the divestiture of its basic chemicals business, it may not gain as much from the shale advantage. However, its glass and fiber glass businesses still use natural gas and it may be able to leverage the situation indirectly.
The company believes that it could become a key supplier of coatings as well as fiber glass pipes which could be used in natural gas drilling operations. Besides a Zacks Rank #2 (Buy), the company has expected earnings growth of 11.50%. It has a P/E (F1) of 20.05.
The increase in shale gas production and the resultant lowering of prices has resulted in benefits which are expected to continue, at least over the medium term. This is why these three choices would make good additions to your portfolio.
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today.
About Zacks
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978. The later formation of the Zacks Rank, a proprietary stock picking system; continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros.
Get the full Report on CHK - FREE
Get the full Report on EOG - FREE
Get the full Report on LYB - FREE
Get the full Report on OCIP - FREE
Get the full Report on PPG - FREE
Follow us on Twitter: http://twitter.com/zacksresearch
Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.
SOURCE Zacks Investment Research, Inc.
WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM?
Newsrooms &
Influencers
Digital Media
Outlets
Journalists
Opted In
Share this article