Not a Fan of Eastman's 'Blowout'

Cramer says the company's earrings will be lower and occur sooner than its share price suggests. He's selling his final 1,000 shares.
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Editor's Note: This was sent to subscribers of Action Alerts PLUS on April 29 at 11:32 a.m. EDT.

Eastman Chemical

(EMN) - Get Report

popped more than 13% this morning after reporting first-quarter earnings and offering second-quarter guidance that were higher than expected. I'm restricted from trading the stock today, but am alerting you readers that I'd be selling my final 1,000 shares here around $53.85 if I could.

The fact is that management has little visibility in its own business. I first bought Eastman in late January following a profit warning, and the company raised guidance just five weeks later. So, forgive me if I have little faith in the sustainability of this morning's "blowout" numbers.

Even though capacity hasn't been able to keep pace with demand in the chemical business, I believe higher interest rates and commodity costs will weigh on growth forecasts across the globe. This means that peak chemical earnings will be lower and occur sooner than Eastman's current share price suggests.

At the time of publication, Cramer was long Eastman Chemical.

James J. Cramer is a director and co-founder of He contributes daily market commentary for's sites and serves as an adviser to the company's CEO. Outside contributing columnists for and, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for

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