Braskem (NYSE:BAK) Issues Quarterly Earnings Results

Braskem (NYSE:BAK) released its quarterly earnings data on Friday. The company reported ($0.52) EPS for the quarter, missing the consensus estimate of $0.02 by ($0.54), FiscalAI reports. Braskem had a negative net margin of 7.28% and a negative return on equity of 67.75%. The business had revenue of $3.78 billion for the quarter, compared to analysts’ expectations of $3.64 billion.

Here are the key takeaways from Braskem’s conference call:

• Recurring EBITDA fell 63% quarter over quarter to $382 million, as petrochemical spreads normalized across all segments; higher selling and U.S. feedstock logistics costs also weighed on results.
• Management expects the global petrochemical downturn to persist, with 2027 spreads in Brazil projected to remain below their 2016–2025 average amid global overcapacity and moderate demand.
• Braskem Idesa’s utilization rate rose 19 percentage points to 62% as ethane supplies increased, lifting polyethylene sales 28%; however, the segment still recorded just $2 million in recurring EBITDA.
• The company generated $429 million in operating cash, including a $198 million working-capital benefit, largely from increased supplier credit and inventory optimization; after other effects and Alagoas-related disbursements, cash generation was about $269 million.
• Braskem said discussions on a consensual capital-structure solution remain open and non-binding, with essential commercial terms still under discussion; management said it would take necessary measures if no agreement is reached.

Braskem Stock Performance

BAK stock traded up $0.01 on Friday, reaching $1.14. The company’s stock had a trading volume of 798,359 shares, compared to its average volume of 3,192,145. The firm has a market cap of $452.81 million, a PE ratio of -0.47, a PEG ratio of 0.06 and a beta of 1.68. The business has a fifty day simple moving average of $1.56 and a two-hundred day simple moving average of $2.91. Braskem has a 12-month low of $0.74 and a 12-month high of $5.39.

Wall Street Analyst Weigh In

A number of brokerages recently issued reports on BAK. Wall Street Zen upgraded Braskem to a “hold” rating in a research report on Saturday, October 17th. Weiss Ratings reissued a “sell (e+)” rating on shares of Braskem in a research note on Thursday, October 15th. UBS Group cut Braskem from a “neutral” rating to a “sell” rating and reduced their target price for the stock from $4.00 to $1.50 in a research report on Tuesday, September 15th. Finally, HSBC cut Braskem from a “buy” rating to a “hold” rating and reduced their target price for the stock from $6.50 to $1.50 in a research report on Monday, September 28th. Three equities research analysts have rated the stock with a Hold rating and five have issued a Sell rating to the company. According to MarketBeat, the stock presently has a consensus rating of “Strong Sell” and an average price target of $2.56.

Braskem Company Profile

Braskem is a Brazilian petrochemical company that produces thermoplastic resins and basic petrochemicals used in packaging, construction, automotive manufacturing, consumer goods and other industries. Its products include polyethylene, polypropylene and polyvinyl chloride, as well as chemical building blocks such as ethylene and propylene. The company also makes bio-based plastics, including polyethylene produced from sugarcane-derived ethanol and marketed under its I’m green brand. These materials are designed to serve applications similar to those of conventional plastics.