Eastman Chemical Company (EMN) Stock Valuation — DCF Analysis
Chemicals · NYSE
Current Price
$75.22
Intrinsic Value
$63.54
-18.4% margin of safety
COMPETITIVE MOAT
↑Specialty Materials Expertise
Eastman's focus on high-performance specialty materials creates differentiated products. This allows for premium pricing and customer loyalty in niche markets.
↑Proprietary Technology & Innovation
The company invests heavily in R&D, developing unique manufacturing processes and innovative product formulations. This intellectual property is difficult for competitors to replicate.
↑Integrated Manufacturing & Scale
Eastman benefits from its large-scale, integrated production facilities. This provides cost advantages and operational efficiencies that smaller players cannot match.
INVESTMENT RISKS
↓Commodity Price Volatility
Input costs for raw materials are subject to global market fluctuations. Significant price swings can impact profitability and margins.
↓Regulatory & Environmental Scrutiny
The chemical industry faces increasing environmental regulations and public scrutiny. Compliance costs and potential liabilities pose ongoing risks.
↓Economic Sensitivity & Cyclicality
Demand for Eastman's products is tied to broader economic conditions. Downturns in key end markets can lead to reduced sales and earnings.
Base case
EMN base case valuation
A base case discounted cash flow model for EMN estimates an intrinsic value of about $63.54 per share, against a current price of $75.22. The model assumes 0.4% annual free cash flow growth, a 10.0% discount rate, and a 17x exit multiple.
Intrinsic Value
$63.54
Margin of safety
-18.4%
Expected annual return
-3.3%
Base case assumptions: 0.4% annual growth, 10.0% discount rate, 17x exit multiple, 5 year projection. Data as of 2026-06-12.
This base case uses default assumptions and is not financial advice. The intrinsic value changes significantly when the growth rate or discount rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the EMN valuation
Adjust the growth rate, discount rate, and exit multiple to see how the intrinsic value and margin of safety for Eastman Chemical Company respond.
Open DCF Calculator for EMNCompany Overview
Eastman Chemical Company functions as a worldwide provider of specialized materials. Its Additives & Functional Products division offers a comprehensive range, including hydrocarbon and rosin resins, organic acid-based solutions, and amine-derived building blocks. This segment also provides agricultural chemicals like metam-based soil fumigants, thiram and ziram fungicides, and plant growth regulators. Additional offerings include specialty coalescents, various commodity and specialty solvents, paint additives, specialty polymers, heat transfer and aviation fluids, and rubber additives such as insoluble sulfur and anti-degradants, along with performance resins. These products cater to diverse sectors such as transportation, personal care, wellness, food, agriculture, construction, water treatment, energy, consumables, durables, and electronics. The Advanced Materials segment produces high-performance products including copolyesters, cellulosic biopolymers, cellulose esters, and polyvinyl butyral (PVB) sheets. It further supplies a variety of window and protective films, including those applied aftermarket, for high-value applications in transportation, consumer durables, electronics, building and construction, medical, pharmaceutical, and general consumables markets. Through its Chemical Intermediates segment, Eastman delivers essential chemical building blocks. This encompasses methylamines and their salts, various higher amines and solvents, olefin and acetyl derivatives, ethylene, and both primary phthalate and non-phthalate plasticizers, including specialized non-phthalate alternatives. These intermediates are vital for industrial chemical processes, construction, health and wellness products, and agrochemical formulations. Lastly, the Fibers segment is a significant producer of cellulose acetate tow, triacetin, cellulose acetate flake, acetic acid, and acetic anhydride, primarily for filtration media, notably cigarette filters. It also furnishes natural and solution-dyed acetate yarns for consumables and health and wellness markets, alongside wet-laid nonwoven media, specialty engineered papers, and cellulose acetate fibers for the transportation, industrial, agriculture, mining, and aerospace industries. Eastman Chemical Company was founded in 1920 and is headquartered in Kingsport, Tennessee.
Financial Metrics — EMN Stock Valuation Data
Revenue/Share (TTM)
$75.78
FCF/Share (TTM)
$4.37
ROIC (TTM)
5.4%
ROE (TTM)
6.8%
P/FCF
17.3x
EV/EBITDA
11.2x
FCF Yield
5.79%
Debt/Equity
0.89x
Based on trailing twelve-month data, EMN shows a free cash flow per share of $4.37 and a ROIC of 5.4%, key inputs for stock valuation using the DCF method. The P/FCF ratio of 17.3x and FCF yield of 5.79% are important context metrics when evaluating EMN's stock valuation relative to peers.
Frequently Asked Questions
What is the intrinsic value of EMN?
Eastman Chemical Company currently generates $4.37 in free cash flow per share. At the current price of $75.22, a DCF model would discount these cash flows at an appropriate WACC and apply a terminal growth rate to arrive at an intrinsic value. The result depends heavily on your growth and discount rate assumptions — a 1% change in WACC typically shifts the fair value estimate by 10-15%. In MiniValuator the model uses a single discount rate that you can edit directly, 10% by default, rather than a computed WACC.
Is EMN undervalued?
EMN trades at a P/FCF ratio of 17.3x with a free cash flow yield of 5.79%. This P/FCF is in a moderate range. However, whether EMN is truly undervalued requires comparing the DCF intrinsic value to the current market price and evaluating whether the margin of safety is sufficient for your risk tolerance.
How do I value EMN stock using DCF?
To perform a DCF valuation on Eastman Chemical Company: (1) Start with the trailing free cash flow per share ($4.37) as the base, (2) project future FCF growth over 5-10 years based on Chemicals industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting EMN's risk profile — with a debt-to-equity of 0.89x, capital structure is an important factor, and (4) add a terminal value for cash flows beyond the projection period.
What is DCF valuation and how does it apply to EMN?
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For Eastman Chemical Company, this means projecting how much free cash flow the company will produce over the next 5-10 years, shaped by Chemicals trends, then discounting those amounts to today's dollars. EMN's ROIC of 5.4% suggests the company may face challenges generating returns above its cost of capital.
How does WACC affect EMN stock valuation?
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For EMN, with a debt-to-equity ratio of 0.89x, the capital structure directly influences WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%. At an EV/EBITDA of 11.2x, the market's implied discount rate can be reverse-engineered for comparison. In MiniValuator you set this discount rate yourself as a single editable number, 10% by default, instead of computing a formal WACC.
Learn More
- See EMN PE Valuation → — Earnings-based stock valuation using PE ratio analysis
- DCF Methodology — Step-by-step guide to discounted cash flow analysis
- PE Methodology — Guide to PE ratio stock valuation
- WACC — Understanding the discount rate used in DCF
- Margin of Safety — How to evaluate downside protection
- Intrinsic Value — How to evaluate stock fair value
- How to Calculate Intrinsic Value — Complete guide for investors
Related Valuations
All Basic Materials valuationsDCF and P/E value EMN with different methods and assumptions, so the two conclusions can differ. Compare the P/E fair value.
Price as of 2026-06-12. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.