Why Calumet Stock Flopped on Friday
Key Points
It boosted revenue nicely in its fourth quarter.
Yet it still posted a net loss for the period.
- 10 stocks we like better than Calumet ›
An earnings report that fell notably short of profitability expectations was the main factor behind Calumet (NASDAQ: CLMT) stock's double-digit decline on Friday. Clearly expressing their dissatisfaction with the oil products company's performance, they traded out of the shares to leave them with an almost 11% loss that trading session.
Solid revenue gains, but...
Calumet released its fourth-quarter and full-year 2025 results before market open on Friday. These showed that the company's sales were just under $1.04 billion in the prior period, up 9% year over year. It also managed to trim its net loss under generally accepted accounting principles (GAAP), which came in at $37 million, or $0.43 per share, against fourth-quarter 2024's $40.7 million.
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Although Calumet topped the average analyst estimate for revenue ($1.02 billion), it badly missed the consensus for per-share net loss of $0.22.
Two of the company's three reporting divisions reported erosion in their non-GAAP (adjusted) earnings before interest, taxes, depreciation, and amortization (EBITDA) for the period. Montana/Renewables flipped to a $5.4 million adjusted EBITDA loss from the year-ago profit of $12.4 million. Performance brands also declined, to $5.4 million from $16.3 million. On a brighter note, specialty products and solutions rose to $88.5 million from $51.9 million.
A year to remember?
Characterizing all of 2025 as a "defining year," for Calumet, CEO Todd Borgmann said that the company made significant improvements to its operations. He said it enacted around $100 million in cost reductions and cleaned up its balance sheet. In his words, this has "positioned the company for its next phase of growth."
I think every stock should be given a chance to turn things around, but aside from the decent revenue increase, I'm not seeing enough evidence of improvement with Calumet just yet. I'd sit on the sidelines with this stock until we get indications that it's heading onto a firmer growth path.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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