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Eastman Chemical EMN is set to release fourth-quarter 2016 results after the bell on Jan 26.

The company saw lower profits in the third quarter of 2016 as its sales fell on reduced selling prices. Adjusted earnings of $1.86 per share in the quarter topped the Zacks Consensus Estimate of $1.67. Revenues fell around 7% year over year to $2,287 million mainly due to lower prices and reduced Fibers sales volume that more than offset higher sales volume in other segments. Sales missed the Zacks Consensus Estimate of $2,308 million.

Eastman Chemical has beaten the Zacks Consensus Estimate in three of the trailing four quarters with an average beat of 5.99%. Let’s see how things are shaping up prior to this announcement.

Factors to Consider

Eastman Chemical, in its third-quarter earnings call, said that it is benefiting from strong growth of its high value products and its cost-cutting actions. The company sees adjusted earnings for 2016 in the band of $6.70 and $6.80 per share.

The company expects to deliver at least $100 million of costs savings for full-year 2016 and an additional $100 million in 2017. The company also recently hiked its quarterly dividend for the seventh consecutive year.

Eastman Chemical remains focused on cost-cutting and productivity actions amid a challenging operating environment. Moreover, Eastman Chemical remains committed to reduce debt and boost shareholder returns leveraging healthy free cash flows.

The company should also gain from its strategic acquisitions and capacity expansion actions. The acquisition of Solutia boosted its presence in the emerging markets and offer growth opportunities in Asia Pacific. The acquisition of BP Plc’s aviation turbine engine oil business has enabled Eastman Chemical to better address the needs of the global aviation industry. Moreover, the purchase of Taminco Corporation has reinforced the company’s foothold in attractive niche end-markets including food, feed and agriculture where Taminco has a strong presence. The acquisition has also provided attractive cost and revenue synergy opportunities.

In Sep 2014, Eastman completed the expansion of Eastman Chemical 168 non-phthalate plasticizer by roughly 15%. With capacity expansion, the company will be able to serve the growing needs of non-phthalate plasticizers worldwide.

Eastman Chemical has outperformed the Zacks categorized Chemicals-Diversified industry over the past three months. The company’s shares have gained around 14.7% over this period, compared with roughly 8.5% gain recorded by the industry.