Summary
- Methanex posted strong results during early 2022, although these began weakening during the fourth quarter.
- They still generated free cash flow, and absent of their flagship Geismar 3 project, they would sport a very high 14%+ free cash flow yield.
- They have more cash than required to finish this project but aim to repay another $300m of debt before boosting their shareholder returns.
- I expect this to be achieved during 2023, possibly as soon as the second half, but if not, it should be done by the end of the year.
- Given their lack of debt maturities afterward, I expect their shareholder returns should be fully unlocked, and thus, I believe that maintaining my strong buy rating is appropriate.
For further details see:
Methanex: Shareholder Returns To Be Fully Unlocked In 2023