Here's Why You Should Retain Huntsman Stock in Your Portfolio

Huntsman Corporation HUN is expected to gain from its investment in downstream businesses, differentiated product innovation, strategic acquisitions and cost actions amid headwinds from soft demand in certain markets and pricing pressure.HUN’s shares have lost 24.8% over a year compared with the Zacks Chemicals Diversified industry’s 5.2% decline. Image Source: Zacks Investment ResearchLet’s find out why HUN stock is worth retaining at the moment.Downstream Expansion & Cost Synergies Aid HUN StockHuntsman remains focused on growing its downstream specialty and formulation businesses and is shifting its MDI (methylene diphenyl diisocyanate) business from components to differentiated systems that typically have higher margins and lower volatility.HUN’s Polyurethanes segment is well positioned for a strong upside in the long term on the back of its focus on ramping up its high-value differentiated downstream portfolio. The substitution of MDI for less effective materials will remain a key driving factor for the MDI business. The company should also gain from significant synergies of acquisitions. Its strong liquidity and balance sheet leverage give it adequate flexibility to continue to develop and expand its core businesses through acquisitions and internal investments. The acquisitions of CVC Thermoset and Gabriel Performance Products are contributing to EBITDA in the Advanced Materials segment.HUN remains committed to its cost realignment and synergy objectives. It realized more than $280 million in run rate savings at the end of 2023. Huntsman expects roughly $60 million of in-year cost optimization benefits, excluding inflation, for 2024. In Polyurethanes, HUN has completed a European restructuring program and expects to realize additional cost savings in 2025.Demand & Pricing Headwinds Ail HuntsmanHuntsman saw challenges from demand softness and significant de-stocking in 2023. Demand conditions in Europe weakened to high levels of natural gas prices. Demand in China was impacted by reduced economic growth partly resulting from lower construction activities.Although demand conditions improved in 2024, the lingering impacts of weaker demand in certain markets are likely to continue in the near term. The residential construction market remains sluggish in China. Weaker demand in general industrial markets is also expected to continue to impact the Advanced Materials unit. Soft global construction and industrials activities are likely to impact HUN’s performance in the fourth quarter. Huntsman also faces headwinds from pricing pressure. Reduced selling prices in the Polyurethanes, Performance Products and Advanced Materials segments had a negative impact in the third quarter of 2024. A less favorable supply-demand environment contributed to the fall in MDI prices. Competitive pressures, particularly in Europe and the Americas, is also affecting the Performance Products segment. Weaker prices are likely to continue to impact HUN’s results in the fourth quarter.Huntsman Corporation Price and Consensus Huntsman Corporation price-consensus-chart | Huntsman Corporation QuoteHUN’s Zacks Rank & Other Key PicksHUN currently carries a Zacks Rank #3 (Hold).Better-ranked stocks in the Basic Materials space are Carpenter Technology Corporation CRS, Sylvamo Corporation SLVM and ICL Group Ltd ICL. While CRS and SLVM sport a Zacks Rank #1 (Strong Buy), ICL carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.Carpenter Technology beat the Zacks Consensus Estimate in each of the last four quarters, with the average earnings surprise being 14.1%. CRS’ shares have soared 211% in the past year. Sylvamo beat the consensus estimate in each of the trailing four quarters. In this time frame, it has delivered an earnings surprise of roughly 16.7%, on average. SLVM’s shares have rallied roughly 74% over the past year.The Zacks Consensus Estimate for ICL Group’s current-year earnings has increased by 8.8% in the past 60 days. ICL beat the consensus estimate in each of the last four quarters with the average surprise being 18.1%.Zacks Names #1 Semiconductor StockIt's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Carpenter Technology Corporation (CRS): Free Stock Analysis Report Huntsman Corporation (HUN): Free Stock Analysis Report ICL Group Ltd. (ICL): Free Stock Analysis Report Sylvamo Corporation (SLVM): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks