It bears repeating that the U.S. and global economies slowed significantly in the second quarter of 2020 due to coronavirus pandemic shutdowns and closures. While basic materials company Celanese Corporation (CE) experienced a big demand drop–for instance in goods supplied for elective surgeries–it and other chemicals companies fared better than other industry groups (travel, energy, movie theaters, restaurants, hotels). At the other end of the spectrum consumer cleaning products companies like Clorox (CLX) had a blowout second quarter.
Specifically, the automotive, building supply, consumer goods, packaging, personal care, and other areas Celanese supplies are now recovering better than expected.
I recommend Celanese for its broad-based product and geographic mix, its manufacturing expertise and leadership in acetic acid and vinyl acetate monomer (VAM), and its access to abundant natural gas production with which to make methanol. While the company’s dividend is not large, third quarter results appear to be rebounding and