Trade-Ideas LLC identified

Huntsman

(

HUN

) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Huntsman as such a stock due to the following factors:

  • HUN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $50.5 million.
  • HUN has traded 691,082 shares today.
  • HUN is down 3.6% today.
  • HUN was up 6.7% yesterday.

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More details on HUN:

Huntsman Corporation, together with its subsidiaries, manufactures and sells differentiated organic and inorganic chemical products worldwide. The company operates in five segments: Polyurethanes, Performance Products, Advanced Materials, Textile Effects, and Pigments and Additives. The stock currently has a dividend yield of 6.3%. HUN has a PE ratio of 36. Currently there are 5 analysts that rate Huntsman a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Huntsman has been 4.4 million shares per day over the past 30 days. Huntsman has a market cap of $2.0 billion and is part of the basic materials sector and chemicals industry. The stock has a beta of 2.85 and a short float of 5.3% with 1.85 days to cover. Shares are down 28.2% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Huntsman as a

hold

. The company's strongest point has been its expanding profit margins. At the same time, however, we also find weaknesses including a generally disappointing performance in the stock itself, deteriorating net income and disappointing return on equity.

Highlights from the ratings report include:

  • HUNTSMAN CORP has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, HUNTSMAN CORP increased its bottom line by earning $1.34 versus $0.54 in the prior year. This year, the market expects an improvement in earnings ($1.72 versus $1.34).
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 18.2%. Since the same quarter one year prior, revenues slightly dropped by 8.5%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • The gross profit margin for HUNTSMAN CORP is rather low; currently it is at 21.83%. Regardless of HUN's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 2.08% trails the industry average.
  • Net operating cash flow has decreased to $206.00 million or 42.77% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 62.04%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 71.05% compared to the year-earlier quarter. Despite the heavy decline in its share price, this stock is still more expensive (when compared to its current earnings) than most other companies in its industry.

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