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Calumet (CLMT) is back on traders' screens after its stock moved higher following fresh geopolitical risks around the Strait of Hormuz, where disrupted shipping pushed Brent crude prices into the mid $80s.
See our latest analysis for Calumet.
The latest move builds on strong recent momentum in Calumet. The stock has a 30 day share price return of 19.23% and a year to date share price return of 141.38%. The 1 year total shareholder return of 230.23% signals that recent price strength sits on top of already substantial gains.
If geopolitical shocks and energy volatility have your attention, this can be a good moment to widen your watchlist with 36 power grid technology and infrastructure stocks
Calumet now trades above the average analyst price target, yet still screens at a discount to some intrinsic value estimates. Is the recent oil driven surge a sign that the market was too cautious, or is that caution still warranted?
Most Popular Narrative: 21.6% Overvalued
Calumet last closed at $47.19, while the most followed narrative pegs fair value at $38.80 using a 7.33% discount rate and detailed long term cash flow assumptions.
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 a material step up in revenues and EBITDA margin expansion once operational.
Want to see what kind of revenue mix and margin profile would support that fair value for Calumet? The key is how future profitability, tax credits and capital intensity fit together in this narrative. The full story lays out a very specific earnings path and the pricing multiple that needs to hold for that to make sense.
Result: Fair Value of $38.80 (OVERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, Calumet still faces key pressure points, including heavy reliance on supportive renewable fuel regulation and a sizeable debt load that could restrict flexibility if conditions change.
Find out about the key risks to this Calumet narrative.
Another View on Calumet's Valuation
The analyst narrative sees Calumet as 21.6% overvalued at $47.19 based on earnings and price targets. Our DCF model points the other way, with a future cash flow value of $72.27 that suggests undervaluation. Which set of assumptions do you find more realistic for Calumet?
Look into how the SWS DCF model arrives at its fair value.
Next Steps
With mixed signals on Calumet's valuation and outlook, now is a good time to review the full picture yourself and move promptly from headline moves to underlying fundamentals. To help frame both the upside potential and the issues investors are watching, take a closer look at 3 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.
Companies discussed in this article include CLMT .
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