Methanex (TSX:MX) Posts Stronger Earnings And Output, Is It Still Cheap?
Methanex earnings and production results draw fresh investor focus
Methanex (TSX:MX) is back in the spotlight after reporting second quarter 2026 results that included higher sales, stronger net income and increased methanol production volumes compared with the same period a year earlier.
See our latest analysis for Methanex.
The latest earnings and production update comes after a strong run in Methanex’s share price, with a 30 day share price return of 18.93% and a year to date share price return of 39.20%. The 1 year total shareholder return of 73.30% highlights how sentiment has shifted over a longer period.
If Methanex’s momentum has caught your eye, this can be a useful moment to broaden your search and check out 3 top founder-led companies
After Methanex’s sharp share price move and strong recent results, investors may be weighing whether to commit fresh capital now or wait for a pullback. The next step is to assess what the current valuation implies.
Most Popular Narrative: 14.4% Undervalued
The most followed valuation narrative currently places Methanex’s fair value at CA$91.07 per share, compared with the last close of CA$77.91, so the story behind that gap matters.
Methanex expects methanol demand to grow in 2025, driven by traditional chemical and energy applications, which could boost revenues.
Increased production at key facilities, such as Geismar and Chile, along with improved operational efficiency, positions the company to capitalize on favorable pricing, potentially enhancing net margins and earnings.
Read the complete narrative. Read the complete narrative.
The fair value hinges on how much extra profit Methanex could squeeze from its existing footprint. The narrative leans heavily on higher margins, steadier cash generation and a valuation multiple that assumes those earnings hold up. It is useful to consider which set of growth and profitability assumptions would need to land for CA$91.07 to make sense.
Result: Fair Value of CA$91.07 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, Methanex’s reliance on contracted gas in regions like Chile and Egypt, and the execution risk around the OCI acquisition, could quickly challenge that undervaluation story.
Find out about the key risks to this Methanex narrative.
Another View on Methanex valuation
The first narrative leans on future earnings power to argue Methanex looks 14.4% undervalued at CA$91.07 per share. A simpler check that looks at today’s numbers tells a different story. The stock trades on a P/E of 48.6x versus 24.3x for the North American Chemicals industry and 18.7x for peers, while the fair ratio is 20.1x. That gap suggests meaningful valuation risk if sentiment cools.
For a closer look at how these P/E gaps stack up against earnings quality and balance sheet strength, See what the numbers say about this price — find out in our valuation breakdown.
Next Steps
The mix of optimism around Methanex’s recent momentum and concern about valuation and project risks creates a genuine debate. If that balance interests you, it is worth reviewing the latest data on both sides through 2 key rewards and 4 important warning signs
Looking for more investment ideas beyond Methanex?
If Methanex has sharpened your focus, do not stop there. Broadening your watchlist can help you spot opportunities you might otherwise miss.
- Scan for potential bargains that pair quality with attractive pricing by checking the 7 high quality undervalued stocks.
- Build a portfolio with income in mind by reviewing companies in the 6 dividend fortresses.
- Prioritise staying power by focusing on financially resilient businesses through the 10 resilient stocks with low risk scores.
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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