• Eastman Chemical Company has reported its full-year 2025 results, with sales of US$8,752 million and net income of US$474 million, both lower than the prior year.
• Alongside this weaker performance, the company is pushing ahead with cost reductions, Fibers business stabilization, and its ethylene-to-propylene (ETP) project to support future earnings.
• With these results now reflected in the market, we'll explore how Eastman's cost-cutting and ETP initiative shape its investment narrative.

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What Is Eastman Chemical's Investment Narrative?

To own Eastman Chemical today, you have to believe that its cost cuts, Fibers stabilization work and ethylene‑to‑propylene (ETP) project can gradually rebuild earnings after a tougher 2025. The latest results confirmed weaker profitability, but they also showed management pressing ahead with US$125 million to US$150 million of savings and an ETP initiative that is expected to add US$50 million to US$100 million to earnings. With the stock having already moved higher in recent weeks, the immediate catalyst is whether these programs start to offset margin pressure and underperformance versus the broader market. At the same time, softer profit margins, relatively high leverage and a dividend that is not well covered by free cash flow keep execution risk front and center. This earnings report fits that picture by reinforcing both the opportunity and the pressure to deliver.

However, one issue around the dividend and cash generation is easy to overlook, and investors should not.

Eastman Chemical's shares have been on the rise but are still potentially undervalued by 32%. Find out what it's worth.

Exploring Other Perspectives

Eight fair value estimates from the Simply Wall St Community span roughly US$60 to US$112, underscoring how differently people see Eastman’s potential. Set that against the recent earnings setback and execution‑dependent cost savings, and it becomes even more important to weigh several viewpoints before deciding how this story might evolve.

Explore 8 other fair value estimates on Eastman Chemical - why the stock might be worth as much as 48% more than the current price!

Build Your Own Eastman Chemical Narrative

Disagree with this assessment? Create your own narrative in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Eastman Chemical research is our analysis highlighting 3 key rewards and 3 important warning signs that could impact your investment decision.
• Our free Eastman Chemical research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Eastman Chemical's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.