Chemours Offers Income Investors Best of Both Worlds
A market sell-off, like the one we witnessed in between February and early April of this year, could be a gold mine for income investors. When fear takes over and investors rush to dump stocks, even strong dividend-paying, blue-chip companies often get caught in the crossfire and become “fallen angels.”
What are fallen angels?
These are companies that, despite solid fundamentals, are overlooked and dragged down with the broader market.
What makes fallen angels particularly attractive to income investors is the effect of falling prices on dividend yields. As stock prices drop, yields rise—creating a rare opportunity to lock in higher income from reliable companies.
One such fallen angel I don’t think my readers should overlook is Chemours Co (NYSE:CC).
In early December 2024, CC stock traded close to $22.00. Now it is trading around $12.30. This represents a decline of over 44% in a matter of months. CC stock is also trading at its lowest levels since 2020, and below its 50-day and 200-day moving average.
Put simply: investor sentiment is bearish.
In the midst of all this, there’s an excellent opportunity in the making here. Investors could get robust income as CC stock recovers and provides solid capital appreciation.
What Does Chemours Do?
Headquartered in Wilmington, Delaware, Chemours Co provides performance chemicals in North America, Asia-Pacific, Europe, the Middle East, Africa, and Latin America.
The company operates through three business segments: Thermal & Specialized Solutions, Titanium Technologies, and Advanced Performance Materials.
The Thermal & Specialized Solutions segment offers refrigerants, thermal management solutions, propellants, foam blowing agents, and specialty solvents under the “Freon” and “Opteon” brands.
Titanium Technologies sells TiO2 pigment, flexible and rigid plastic packaging, polyvinylchloride, laminate papers, coated paper, and coated paperboard under the “Ti-Pure” brand.
Chemours’ Advanced Performance Materials segment offers a portfolio of products such as specialty product solutions, membranes, industrial resins, additives, films, and coatings. These products are sold under the “Teflon,” “Viton,” “Krytox,” and “Nafion” brand names.
The company sells its products through direct and indirect channels and a network of resellers, third-party sales agents, and distributors. (Source: “Profile,” Yahoo! Finance, last accessed May 1, 2025.)
CC Stock Selling at a Massive Discount
Thanks to the sell-off, CC stock is now selling at a deep discount.
Before talking about valuations, here’s some perspective on how financials are expected to look in 2025 and 2026.
According to Wall Street analysts, Chemours is expected to report revenue growth of 1.51% in 2025 and earnings per share (EPS) of $1.84. For 2026, they are expecting revenue growth of a little over four percent, and EPS of $2.62. (Source: “Analysis,” Yahoo! Finance, last accessed May 1, 2025.)
You see, the company’s financial performance is expected to improve this year and the next, yet CC stock is selling like there’s a worst-case scenario at play here.
Looking at valuation: CC stock now trades at a price-to-sales (P/S) ratio of just 0.32. This indicates that investors are valuing each $1.00 of sales at the company at just $0.32. This is well below the five-year average P/S ratio of 0.68. (Source: “Valuation,” Morning Star, last accessed May 1, 2025.)
If you look at other valuation measures, they all show CC stock selling at valuations that are hard to ignore.
Assuming that CC stock’s valuations come back to their averages, it could mean an immense windfall for shareholders.
Chart courtesy of StockCharts.com
CC Stockholders Get Paid to Wait
While CC stock is down, the dividend is robust here. It wouldn’t be wrong to say that shareholders get paid a decent amount to just “buy and wait.”
Like clockwork, investors get a quarterly dividend payment of $0.25 per share. This amounts to $1.00 per share on an annual basis, for a frothy dividend yield of close to 8.15%.
The best part: if Chemours Co’s business improves, its dividend amount could increase as well.
In 2016, CC stockholders received a quarterly dividend of $0.03. The payout increased to $0.17 per share in 2018 and then $0.25 per share in late 2018.
The Lowdown on CC Stock
With CC stock, investors could get the best of both worlds: robust capital appreciation and a decent dividend that’s hard to find in blue-chip companies these days.
Chemours is a major player in its industry with a massive product portfolio and products that are in demand no matter what the stock market is doing or how the economy is looking.
Investors have turned sour on CC stock even though Chemours’ financial performance is expected to be better this year and the next, and it’s anticipated that the company will remain profitable throughout that time. CC stock truly checks all the boxes of a fallen angel, offering income investors a unique opportunity.