MEOH Refinances Natgasoline Bonds to Improve Financial Flexibility

Methanex Corporation MEOH has announced a refinancing of Natgasoline LLC’s outstanding municipal bonds by issuing a tax-exempt bond, further strengthening the financial flexibility of the joint venture. Methanex owns a 50% equity interest in Natgasoline, which is operated through a joint venture with Consolidated Energy Limited.

Natgasoline has priced $290.95 million of tax-exempt bonds through the Mission Economic Development Corporation, which carry a 4.75% coupon, with a mandatory tender date of Aug. 1, 2036, and final maturity on Aug. 1, 2046. The transaction is expected to close around Aug. 28, 2026, subject to customary conditions.

Proceeds from the issuance will be used to repay Natgasoline’s existing $290.95 million municipal bonds issued in 2018, which are scheduled to mature in 2031. The earlier bonds were subject to semi-annual amortization through a sinking fund redemption beginning on Oct. 1, 2025.

The refinancing defers mandatory amortization requirements, providing Natgasoline with greater flexibility in managing its operating cash flows. Methanex expects this flexibility could also support efforts to reduce higher-cost borrowings and leverage.

MEOH’s shares have gained 62.9% over the past year compared with the industry’s 1.2% rise.

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Methanex continues to expect 2026 production of approximately 9 million tons of methanol on a Methanex-interest basis and 0.3 million tons of ammonia.

Based on July and August posted prices and assuming market conditions remain consistent, management expects the average realized price to be $460-$485 per ton for the two months. With a lower realized price and similar sales of produced methanol, Methanex expects adjusted EBITDA to decline sequentially in the third quarter.

MEOH’s Zacks Rank & Key Picks

MEOH currently carries a Zacks Rank #3 (Hold). 

Some better-ranked stocks in the Basic Materials space are Neo Performance Materials Inc. NOPMF, Carpenter Technology Corporation CRS and Avient Corporation AVNT.

While NOPMF currently sports a Zacks Rank #1 (Strong Buy), CRS and AVNT carry a Zacks Rank #2 (Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for NOPMF’s 2026 earnings is pinned at $1.4 per share, indicating a 185.71% year-over-year increase. NOPMF’sshares have gained 94.3% over the past year.

The Zacks Consensus Estimate for CRS’ fiscal 2027 earnings is pegged at $12.92 per share, indicating a rise of 20.07% year over year. Its earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with an average surprise of 8.39%.

The Zacks Consensus Estimate for AVNT’s current-year earnings is pinned at $3.2 per share, indicating a 13.48% year-over-year increase. Its earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with an average surprise of 3.4%. AVNT’s shares have gained 16.5% over the past year.

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This article originally published on Zacks Investment Research (zacks.com).

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