Calumet (CLMT) Could Be 10% Overvalued As It Redeems $100 Million Of Notes
Calumet (CLMT) is back on investors’ radar after Calumet Specialty Products Partners and Calumet Finance Corp. moved to redeem all $100 million of their 9.75% Senior Notes due 2028 at a premium in mid July.
See our latest analysis for Calumet.
The redemption news comes as Calumet’s share price trades at $42.83, with a 1 day share price return of 4.26% and a 30 day share price return of 29.20%. This has contributed to a stronger year to date share price return of 119.08% and a 1 year total shareholder return of 165.37% that points to building momentum around the stock.
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With Calumet retiring high cost debt and the stock already sharply higher, the real issue now is whether today’s price still offers an appealing entry or if patience for a cheaper reset makes more sense as valuation comes under the microscope.
Most Popular Narrative: 10% Overvalued
Calumet’s last close at $42.83 sits above the most widely followed fair value estimate of $38.80, putting the current analyst narrative under the spotlight.
The MaxSAF 150 project is on track to start up in the first half of 2026, enabling Calumet to produce 120-150 million annual gallons of sustainable aviation fuel (SAF) at relatively low capital costs, capturing premiums of $1-$2/gallon over renewable diesel and tapping into surging mandated and voluntary SAF demand globally; this is likely to drive material step-up in revenues and EBITDA margin expansion once operational.
Want to see what kind of revenue path, profit turnaround, and future earnings multiple are baked into that fair value line? The full narrative lays out a detailed set of growth, margin and valuation assumptions that go well beyond today’s share price moves.
Result: Fair Value of $38.80 (OVERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, Calumet’s story also depends heavily on continued regulatory support for renewable fuels and on managing a sizeable debt load that can constrain flexibility.
Find out about the key risks to this Calumet narrative.
Next Steps
With mixed sentiment across Calumet’s story, this is a good time to move quickly, weigh both the concerns and the upside, and form your own view by checking the 2 key rewards and 1 important warning sign
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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