Methanex (MEOH) Stock Forecast & Price Target

Methanex Corp is poised for a positive outlook as the methanol price floor is anticipated to strengthen, rising from the $260s to approximately $280, primarily due to an improved Chinese thermal coal outlook. The company's ability to secure a premium on the average selling price (ASP) — which increased from $56 per metric ton (mt) in Q1 to $80/mt in Q2 — reflects the effectiveness of its contracting strategy, enabling it to realize prices well above the market average. Additionally, the expected growth in Chinese spot methanol prices, combined with strong demand for methanol in various industries, enhances the overall revenue potential for Methanex, particularly in its key European market.

Methanex Corp is facing negative outlook pressures primarily due to low Q3 EBITDA results, which have adversely affected its balance sheet leverage and diminished the positive effects of share buybacks on valuation. The market is currently unduly impacted by struggling methanol demand, evidenced by oversupply conditions illustrated by low acetic acid prices in China and challenging economics for MTO plants. Additionally, expected declines in export loading further exacerbate the weak methanol pricing environment, suggesting a concerning trend for the company's financial performance in the near term.