JPMorgan says chemical stock to win from Iran war supply disruption
Shares of Eastman Chemical have fallen 2% since the start of the U.S.-Iran war. JPMorgan thinks that’s surprising given the margin upside the company could realize as commodity prices surge. The bank upgraded Eastman Chemical’s stock to overweight from neutral on Tuesday, hiking its price target to $80, which indicates a potential 8% gain from Monday’s close. Analyst Jeffrey Zekauskas said the prices of two key chemicals, ethylene and propylene, have jumped due to the conflict in the Middle East. Each year, Eastman Chemical produces 1.1 billion pounds of ethylene and 500 million pounds of propylene. EMN mountain 2026-02-27 EMN since Feb. 27, 2026 Although the company will face higher input costs, Eastman will realize net benefits of about $282 million, or about $1.60 per share, in 2026 from higher product prices, Zekauskas estimated. “We estimate that higher commodity prices benefit Eastman’s EBITDA by $200-300m on annualized basis and add ~$50m per quarter to Eastman’s Chemical Intermediates segment for the remaining three quarters in 2026,” he wrote. And while Zekauskas believes these chemical price hikes will be catalysts in the near-term, longer-term he thinks a recovery in durable goods manufacturing will aid shares. With a solid balance sheet, a 4.5% dividend yield and several cost reduction initiatives underway the stock is attractive to buy, he said. “We think that Eastman is a good risk/reward vehicle on a total return basis,” Zekauskas said. “We expect Eastman’s earnings to experience a positive turn in 2026.”