MEOH

Methanex Corp

Industrial/Transportation


Presented:07/08/2013
Price:$43.65
Cap:$3.40B
Current Price:$40.89
Cap:$2.76B

Presented

Date07/08/2013
Price$43.65
Market Cap$3.40B
Ent Value$3.95B
P/E Ratio11.71x
Book Value$19.35
Div Yield1.9%
Shares O/S94.94M
Ave Daily Vol270,000
Short Int3.00%

Current

Price$40.89
Market Cap$2.76B
Methanex Corporation produces, supplies, and sells methanol to petrochemical producers and distributors. The company also purchases and re-sells methanol produced by others. Its methanol is a clear liquid commodity chemical that is used to produce traditional chemical derivatives, including formaldehyde, acetic acid, and various other chemicals. The company’s methanol is used in energy-related applications; for blending into gasoline, as a feedstock in the production of dimethyl ether, which can be blended with liquefied petroleum gas for use in household cooking and heating, and in the production of biodiesel; and to produce methyl tertiary-butyl ether, a gasoline component, as well as used into olefins applications. In addition, it operates a fleet of methanol ocean tankers with a capacity ranging from 3,000 to 100,000 deadweight tons. The company has a network of production hubs and terminals in North and South America, New Zealand, Europe, the Middle East, and Asia, as well as distributed terminals and storage facilities located throughout in the U.S Gulf Coast, the Mediterranean, Northwest Europe, Korea, and South China. Methanex Corporation was founded in 1968 and is headquartered in Vancouver, Canada.

Highlights

The presenter is long shares of Methanex, the Canadian producer of methanol, and believes its shares have 35%-40% upside potential from current levels. Generally speaking, he said investors tend to view MEOH as a commodity cycle play with “standard” supply/ demand dynamics. However, in his opinion the long position can work in a flat commodity price environment, and the tight market dynamics ultimately benefit the company’s margins.

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