Huntsman Corporation
HUN
$13.25
-3.00%
Huntsman Corporation is a US-based manufacturer of differentiated organic chemical products, operating in the global Basic Materials sector within the Chemicals industry. Its core business segments include Polyurethanes (primarily MDI and polyols), Performance Products, and Advanced Materials, with products used in adhesives, aerospace, automotive, and construction. The company is a significant, established player in the chemical intermediates market, particularly known for its polyurethane systems. The current investor narrative centers on navigating a challenging cyclical downturn, as evidenced by recent quarterly losses and revenue declines, while maintaining its dividend to signal financial stability amidst weak end-market demand in key sectors like construction and automotive.…
HUN
Huntsman Corporation
$13.25
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Investment Opinion: Should I buy HUN Today?
Rating: Hold. The core thesis is that HUN presents a high-risk, high-potential-reward cyclical turnaround bet, but the timing of the inflection point remains too uncertain to warrant a Buy, given the current fundamental deterioration.
Supporting evidence includes an extreme valuation discount (PS of 0.30 vs. a historical high above 3), positive TTM free cash flow of $116 million, and analyst expectations for a sharp Q1 2026 EPS rebound to $0.47. However, these are counterbalanced by concrete negatives: a -6.7% YoY revenue decline, a net margin of -4.8%, and a forward PE of 101.3 which is stratospheric and indicates earnings are expected to be minimal. The stock's 11.62% 1-month rally suggests the market is beginning to price in a recovery, but it remains 32.5 percentage points behind the SPY over the past year.
The thesis would upgrade to a Buy on confirmation of the earnings rebound (Q1 2026 EPS meeting or exceeding $0.47) and stabilization of gross margins above 14%. It would downgrade to a Sell on a break below the $7.30 support level or a further deceleration in revenue growth. Relative to its own distressed history and the challenged chemicals sector, the stock is fairly valued for the deep cyclical risk it carries; it is not cheap enough to ignore the fundamental weakness, nor is it expensive given the potential recovery upside.
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HUN 12-Month Price Forecast
HUN is a classic deep-cyclical at a potential inflection point, creating a binary outcome. The AI assessment is neutral due to the high uncertainty surrounding the timing and magnitude of a recovery. The extreme valuation provides a margin of safety, but the fundamental picture remains weak. Confidence is medium because the key catalyst—Q1 2026 earnings—is a near-term known unknown. The stance would upgrade to bullish on confirmation of sustained profitability and margin improvement. It would turn bearish if the stock breaks below $11 and the Q1 earnings miss, signaling the recovery narrative is broken.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Huntsman Corporation's 12-month outlook, with a consensus price target around $17.23 and implied upside of +30.0% versus the current price.
Average Target
$17.23
8 analysts
Implied Upside
+30.0%
vs. current price
Analyst Count
8
covering this stock
Price Range
$11 - $17
Analyst target range
Analyst coverage is limited, with only 8 analysts providing estimates, indicating this is not a widely followed large-cap name. The available data shows consensus estimates for the next quarter, with an average EPS forecast of $0.47 and revenue of $6.36 billion, but does not provide a consensus price target or recommendation breakdown. The institutional ratings from recent months show a predominance of neutral to negative sentiment, with firms like JP Morgan downgrading to 'Neutral' from 'Overweight' in February 2026, and Mizuho maintaining an 'Underperform' rating. The lack of a published average target price and the preponderance of 'Neutral' and 'Sector Perform' ratings suggest analysts see limited near-term catalysts for outperformance. The wide dispersion in recent rating actions, from downgrades to maintained underperform calls, signals high uncertainty and a lack of conviction regarding the company's ability to navigate the current downturn, which aligns with the stock's depressed valuation and weak fundamental picture.
Bulls vs Bears: HUN Investment Factors
The evidence is finely balanced but tilts bearish on fundamentals versus bullish on valuation and sentiment. The bear case is anchored in concrete, deteriorating financials: sustained revenue declines, negative margins, and negative returns on capital. The bull case rests on the expectation of a cyclical rebound, as signaled by extreme valuation compression (PS of 0.30), positive short-term momentum, and analyst forecasts for a sharp EPS recovery next quarter. The single most important tension in the investment debate is whether the company's deep cyclical downturn has reached an inflection point. If Q1 2026 results confirm the analyst-projected return to profitability, the valuation discount could unwind rapidly. If losses persist or worsen, the stock could retest its 52-week low, validating the bearish fundamental view.
Bullish
- Extreme Valuation Discount: HUN trades at a Price-to-Sales ratio of 0.30, near the absolute bottom of its historical range and a fraction of its 2021 high of 3.46. This deep discount prices in severe cyclical pessimism, offering significant upside if fundamentals stabilize.
- Strong Short-Term Momentum: The stock is up 11.62% over the past month and 12.09% over three months, significantly outperforming the SPY. This suggests a potential oversold bounce and growing market belief in a cyclical trough, with the price nearing its 52-week high of $14.38.
- Positive Free Cash Flow & Dividend: Despite losses, the company generated $116 million in TTM free cash flow, providing financial flexibility. The maintenance of its dividend, yielding 8.44%, signals management's confidence in liquidity and commitment to shareholder returns during the downturn.
- Analyst Expects Sharp EPS Recovery: Analysts forecast next quarter EPS of $0.47, a dramatic swing from the recent Q4 2025 loss of -$0.56. This anticipated inflection point is a key catalyst, suggesting the market expects a rapid earnings rebound from cyclical lows.
Bearish
- Severe Profitability Collapse: The company reported a Q4 2025 net loss of -$96 million with a gross margin of 12.1%, down from 14.2% in Q1 2025. Trailing ROE is -10% and ROA is -0.062%, indicating fundamental deterioration and inefficient capital use.
- Persistent Revenue Decline: Q4 2025 revenue of $1.355B declined -6.7% YoY, continuing a pattern of contraction. This reflects weak end-market demand in key sectors like construction and automotive, with no clear sign of a bottom in the cycle.
- Analyst Sentiment Neutral to Negative: Recent analyst actions include JP Morgan's downgrade to 'Neutral' and Mizuho's 'Underperform' rating. The lack of a consensus price target and predominance of neutral ratings reflect high uncertainty and a lack of conviction in a near-term recovery.
- Long-Term Underperformance & High Short Interest: HUN's 1-year return of +2.38% lags the SPY by over 32 percentage points, showing severe relative weakness. A short ratio of 2.87 indicates significant bearish betting, suggesting professional skepticism about the recovery narrative.
HUN Technical Analysis
The stock is in a pronounced downtrend over the past year, with a 1-year price change of only +2.38%, significantly underperforming the SPY's +34.9% gain, as indicated by a stark -32.52 relative strength. The current price of $13.35 is trading near the midpoint of its 52-week range ($7.30 to $14.38), suggesting the stock is not at an extreme but remains in a weak long-term posture. Recent momentum, however, shows a notable divergence, with the stock up 11.62% over the past month and 12.09% over the past three months, indicating a potential short-term recovery attempt or oversold bounce from deeply depressed levels. This positive short-term momentum against a weak annual backdrop suggests the possibility of a mean reversion rally, though the stock's low beta of 0.603 indicates its moves are generally less volatile than the broader market. Key technical levels are clear, with immediate resistance at the 52-week high of $14.38 and critical support at the 52-week low of $7.30. A breakout above the $14.38 resistance would be a significant bullish signal, potentially confirming a trend reversal, while a break below the $7.30 support would signal a resumption of the primary downtrend. The stock's low beta suggests it may offer some defensive characteristics, but its recent price action shows it has begun to decouple from the market's weakness.
Beta
0.60
0.60x market volatility
Max Drawdown
-54.2%
Largest decline past year
52-Week Range
$7-$14
Price range past year
Annual Return
-1.6%
Cumulative gain past year
| Period | HUN Return | S&P 500 |
|---|---|---|
| 1m | +5.4% | +12.6% |
| 3m | +18.5% | +2.5% |
| 6m | +60.0% | +4.3% |
| 1y | -1.6% | +28.4% |
| ytd | +30.0% | +4.3% |
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HUN Fundamental Analysis
Revenue trends are weak, with the most recent Q4 2025 revenue of $1.355 billion reflecting a -6.7% year-over-year decline, continuing a pattern of contraction from prior quarters. Segment data shows the vast majority of revenue, $1.121 billion, comes from the Diversified segment, which is likely facing cyclical headwinds. Profitability is under severe pressure, with the company reporting a net loss of -$96 million in Q4 2025 and a gross margin of just 12.1%, down from 14.2% in Q1 2025, indicating significant margin compression. The trailing twelve-month EPS is negative at -$0.16, and the net margin stands at -4.8%, highlighting the company's struggle to maintain profitability in the current environment. The balance sheet shows moderate leverage with a debt-to-equity ratio of 0.99, but liquidity appears adequate with a current ratio of 1.30. Free cash flow over the TTM is positive at $116 million, providing some financial flexibility, but the negative Return on Equity of -10% and Return on Assets of -0.062% underscore inefficient capital allocation and poor earnings power in the current cycle.
Quarterly Revenue
$1.4B
2025-12
Revenue YoY Growth
-0.06%
YoY Comparison
Gross Margin
+0.12%
Latest Quarter
Free Cash Flow
$116000000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is HUN Overvalued?
Given the negative trailing net income, the primary valuation metric selected is the Price-to-Sales (PS) ratio. The stock trades at a trailing PS ratio of 0.30, which is exceptionally low and suggests the market is assigning minimal value to its revenue base. There is no forward PS provided for comparison. Compared to industry averages, this PS ratio likely represents a deep discount, reflecting the market's severe pessimism regarding near-term profitability and growth prospects in the cyclical chemicals sector. Historically, the stock's own valuation has compressed dramatically; for instance, its PS ratio was as high as 3.46 in early 2021. Trading at a PS of 0.30 places it near the absolute bottom of its historical range, which typically signals either a deep value opportunity or a fundamental deterioration that the market believes is permanent. The current valuation implies the market is pricing in sustained challenges, with little expectation for a near-term recovery in earnings power.
PE
-6.3x
Latest Quarter
vs. Historical
Mid-Range
5-Year PE Range -136x~64x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
16.3x
Enterprise Value Multiple
Investment Risk Disclosure
Financial & Operational Risks are acute, centered on profitability collapse and leverage. The company's gross margin compressed to 12.1% in Q4 2025 from 14.2% earlier in the year, while it reported a net loss of -$96 million. With a debt-to-equity ratio of 0.99 and negative ROE of -10%, the business is burning through equity and depends on a cyclical recovery to service its balance sheet. The revenue concentration in the cyclical Diversified segment ($1.121B of total revenue) exposes HUN to prolonged weakness in construction and automotive markets, with no diversification cushion.
Market & Competitive Risks include valuation compression and sector headwinds. While the current PS ratio of 0.30 is deeply discounted, a failure to return to profitability could lead to a permanent de-rating. The stock's low beta of 0.603 offers some defensive characteristic but also indicates it may not participate fully in broader market rallies. Competitive pressures in the chemical industry could prevent margin recovery even if demand stabilizes, and the lack of analyst bullish conviction (neutral/underperform ratings) suggests limited near-term catalyst support.
Worst-Case Scenario involves a protracted cyclical downturn where HUN fails to achieve the forecasted Q1 profit, leading to further margin erosion and a potential dividend cut. This could trigger analyst downgrades and force a re-test of the 52-week low of $7.30. From the current price of $13.35, this scenario implies a downside of approximately -45%. The historical max drawdown of -57.98% provides a precedent for such severe losses during downturns, highlighting the stock's vulnerability if the recovery narrative fails.
FAQ
The key risks are, in order of severity: 1) Fundamental Deterioration Risk: Continued revenue declines and losses, as seen in Q4 2025 (-6.7% YoY revenue, -$96M net income). 2) Cyclical Downturn Risk: Prolonged weakness in core end-markets like construction and automotive, delaying any recovery. 3) Financial Risk: A debt-to-equity ratio of 0.99 coupled with negative ROE (-10%) strains the balance sheet if losses continue. 4) Sentiment & Liquidity Risk: Low analyst coverage, neutral/negative ratings, and a short ratio of 2.87 could lead to heightened volatility and limited buying support on setbacks.
The 12-month forecast presents three scenarios. The Base Case (50% probability) sees a slow recovery with a target range of $12-$14, assuming the company returns to modest profitability but growth remains weak. The Bull Case (30% probability), with a target of $16-$18, requires a sharp cyclical rebound confirmed by Q1 EPS of $0.47+ and margin expansion. The Bear Case (20% probability) projects a drop to the $7.30-$9 range if the earnings rebound fails and the downturn deepens. The Base Case is most likely, predicated on the assumption that the company stabilizes but does not quickly return to historical profitability levels.
HUN is profoundly undervalued on a sales basis but arguably overvalued on an earnings basis, reflecting its distressed state. Its Price-to-Sales ratio of 0.30 is near historical lows and represents a deep discount to its own history (peak PS of 3.46) and likely to industry peers. However, its forward P/E of 101.3 is exorbitant, signaling the market expects minimal near-term earnings. The valuation implies the market is pricing in a permanent impairment of profitability. Therefore, it is fairly valued for the deep cyclical risk it carries—it is cheap only if a recovery occurs.
HUN is a high-risk, high-potential-reward stock that is only a good buy for a specific investor profile. For a risk-tolerant investor seeking a deep-value cyclical turnaround, the extreme valuation (PS of 0.30) and analyst forecast for a sharp EPS rebound to $0.47 next quarter create an intriguing opportunity. However, given the severe fundamental deterioration (-6.7% revenue decline, -$96M Q4 loss) and neutral-to-negative analyst sentiment, it is not a good buy for conservative or income-focused investors. The decision hinges entirely on one's conviction in the timing of the chemical cycle recovery.
HUN is unsuitable for short-term trading due to its low beta (0.603) and dependence on cyclical catalysts that unfold over quarters. It is best approached as a medium-to-long-term (2-3 year) speculative investment for investors betting on a full chemical cycle recovery. The high dividend yield (8.44%) provides some income while waiting, but the primary thesis is capital appreciation from multiple expansion as earnings recover. Given the volatility evidenced by a 52-week range of $7.30 to $14.38 and the binary nature of the turnaround, a minimum holding period of 12-18 months is suggested to allow the investment thesis to play out.