Why Huntsman (HUN) Stock Is Gaining Today

NEW YORK (TheStreet) -- Shares of Huntsman Corp. (HUN) are gaining, up 5.42% to $28.42, after the chemical products company announced today that the European Commission approved its acquisition of the performance additives and titanium dioxide business from Rockwood Holdings  (ROC) .

Also, Huntsman has agreed to a deal with Henan Billions Chemicals to sell its TR52 business, the main titanium dioxide grade used for printing ink applications. The terms of the deal were not disclosed.

The agreement with Rockwood is expected to close in the coming week, pending the approval of the TR52 division sale.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

Separately, TheStreet Ratings team rates HUNTSMAN CORP as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:

"We rate HUNTSMAN CORP (HUN) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, revenue growth, solid stock price performance, impressive record of earnings per share growth and notable return on equity. We feel these strengths outweigh the fact that the company shows weak operating cash flow."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Chemicals industry. The net income increased by 153.2% when compared to the same quarter one year prior, rising from $47.00 million to $119.00 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 7.8%. Since the same quarter one year prior, revenues slightly increased by 5.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Powered by its strong earnings growth of 152.63% and other important driving factors, this stock has surged by 53.57% over the past year, outperforming the rise in the S&P 500 Index during the same period. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
  • HUNTSMAN CORP reported significant earnings per share improvement in the most recent quarter compared to 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 reported lower earnings of $0.54 versus $1.53 in the prior year. This year, the market expects an improvement in earnings ($2.10 versus $0.54).
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. In comparison to the other companies in the Chemicals industry and the overall market, HUNTSMAN CORP's return on equity is significantly below that of the industry average and is below that of the S&P 500.
  • You can view the full analysis from the report here: HUN Ratings Report

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he and Stephanie Link think could be potentially HUGE winners. Click here to see the holdings for FREE

If you liked this article you might like

Fed, Toys 'R' Us, Equifax and Hurricane Maria - 5 Things You Must Know

White Tale Increases Clariant Stake, Repeats Opposition to Huntsman Merger

Vantiv-Worldpay Deal an Inversion That Wasn't

Clariant Enlists Goldman to Help Fend Off Activist Group

New Tronox Chairman Faces Test at Coatings and Pigments Maker