Methanex
The world's largest methanol producer, freshly enlarged by the OCI acquisition, riding a cyclical price recovery while carrying more debt.
The business
Methanex produces and markets methanol globally, with plants in North and South America, New Zealand, Egypt and — via the 2025 OCI Methanol acquisition — the US Gulf Coast, selling into chemical, energy and increasingly marine-fuel markets.
Methanol demand tracks construction, autos and energy; Methanex also promotes methanol as a lower-emission marine fuel, a potential long-run growth vector.
The moat
Global scale and the industry's largest supply, distribution and shipping (Waterfront) network give Methanex cost, reliability and price-setting influence.
Low-cost, gas-linked feedstock contracts and geographic diversification cushion regional gas shocks, but methanol is a commodity with no pricing power beyond the cycle.
Related on CoinCompass: Materials & mining · FCF yield ranking. For the underlying numbers, see Methanex — Investor Relations.
Financial snapshot
Most recent reported period : Q2 2026 (ended Jun 30, 2026). Figures reflect the review date — confirm current numbers before acting.
| Revenue (Q2 2026) | US$1.395B |
| Net income (Q2 2026) | US$198M |
| Adjusted EPS (Q2 2026) | US$3.87 |
| Operating cash flow (TTM) | ~US$995M |
| Dividend / share | ~US$0.74/yr (~1.3% yield) |
| Market cap | ~C$6.0B (~US$4.4B); P/E ~48x |
| Share price (Aug 4, 2026) | C$75.31 |
Free cash flow yield & sustainable growth
Free cash flow yield : ≈13% (est.)TTM operating cash flow is ~US$995M; with Geismar-3 growth capex complete, free cash flow is roughly US$0.6–0.9B, an estimated low-to-mid-teens FCF yield on the ~US$4.3B market cap — before netting the added OCI-acquisition debt, which lowers it on an enterprise-value basis. Estimated and cyclical.
Q2 2026 rebounded to US$198M net income and US$3.87 adjusted EPS on record North American production. With Geismar 3 complete, growth capex is falling and lifting free cash flow — but the OCI Methanol acquisition added significant debt that FCF must now service.
Valuation & what to watch
At C$75.31 (~US$4.4B market cap) the shares carry a high trailing P/E (~48x) that reflects a depressed-earnings trough; on cash flow and mid-cycle earnings the multiple is far lower. The stock is a bet on methanol prices normalising above cash-cost support.
Dividend
Pays ~US$0.185/quarter (~US$0.74/yr, ~1.3% yield). Methanex has historically favoured debt reduction and buybacks over dividend growth; post-OCI deleveraging likely takes precedence.
Risks & the bear case
- Methanol is a global commodity — prices swing with energy, construction and Chinese demand, driving large earnings volatility.
- Higher leverage after the OCI Methanol acquisition raises financial risk if the cycle turns.
- Natural-gas feedstock cost and availability (Egypt, New Zealand, Chile) can curtail production.
- Integration risk on the newly acquired US Gulf Coast assets.
Recent developments
Q2 2026 (ended June 30, 2026): revenue US$1.395B, net income US$198M, adjusted EPS US$3.87, with record North American production.
Completed the acquisition of OCI's methanol business, expanding US Gulf Coast capacity while increasing debt.
Verdict
Methanex is the scale leader in a deeply cyclical commodity. Post-Geismar-3 and post-OCI it should generate strong free cash flow at mid-cycle prices, but the elevated trailing P/E, added acquisition debt and pure commodity exposure mean returns hinge on the methanol cycle and on deleveraging. Best understood as a cyclical cash-flow story, not a defensive holding. Publisher research, not investment advice.
Sources
CoinCompass is a publisher, not a registered investment adviser. This is factual information and opinion for a general audience — not a recommendation to buy or sell any security, and not individualized advice. Figures are the most recent reported at the review date and will change. The author, John Wilson, has disclosed long-term holdings in Canadian equities (including Boyd Group, Constellation Software and MTY Food Group) and may hold positions in securities discussed. Do your own research or consult a licensed professional. See our disclosures. John Wilson → · disclosures →