JPMorgan ups NOVA Chemical 2007 & 2008 estimate

10 October 2007 16:22  [Source: ICIS news]

MUMBAI (ICIS news)--JPMorgan raised its earnings estimates for NOVA Chemicals on Wednesday to reflect the company’s use of cheaper ethane feedstock from Alberta, Canada, and the benefits of restructuring in its styrenics business.

 

The bank raised the company's 2007 earnings per share (EPS) estimate to $3.55 (€2.52)/share from $3.35/share previously, while increasing its 2008 projection to $3.25/share from $3.15/share.

 

Nova was expected to benefit from its so-called Alberta Advantage - the company’s access to relatively low-cost ethane feedstock compared with the increasingly expensive prices utilised by its US Gulf Coast competitors.

 

“We expect the purchase and closure of Sterling’s large-scale styrene monomer unit in Texas by the NOVA INEOS joint venture will remove approximately 11% of North American capacity and lift depressed industry operating rates,” the bank added.

 

For the third quarter of 2007, JPMorgan raised NOVA Chemicals' EPS estimate to $1.10/share from $0.95/share previously, and $0.66/share in the same quarter a year-ago.

 

The bank has a "neutral" rating on the stock.

 

Shares of the company last closed at $38.49/share on the New York Stock Exchange.

 

($1 = €0.71)

By: Isha Jha
+65 6780 4359

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