Huntsman Corporation
HUN
$10.62
-3.01%
Huntsman Corporation is a global manufacturer of differentiated organic chemical products, operating within the Basic Materials sector and specifically the Chemicals industry. Its core product portfolio includes Methyl diphenyl diisocyanate (MDI), Amines, Maleic anhydride, and Epoxy-based formulations, which are essential components for adhesives, aerospace, automotive, and construction materials. The company is a significant player in the polyurethanes market, deriving the majority of its revenue from this segment, and competes as a large-scale, integrated chemical producer with a focus on specialty and performance chemicals. The current investor narrative is dominated by the recently announced merger with Olin Corporation, which has introduced significant uncertainty and led to a sharp sell-off as the market assesses the dilution for Huntsman shareholders and the strategic rationale of combining two major chemical entities during a period of cyclical demand weakness.…
HUN
Huntsman Corporation
$10.62
Related headlines
Investment Opinion: Should I buy HUN Today?
Rating & Thesis: HOLD. The stock presents a classic 'value trap' scenario—deeply undervalued on sales but facing severe near-term headwinds from cyclical losses and merger uncertainty, making a Buy recommendation premature despite the attractive valuation. Analyst sentiment is neutral to negative, reflecting this high uncertainty.
Supporting Evidence: The primary valuation metric, a PS ratio of 0.30, is at a multi-year low and represents a ~70% discount to industry peers. The company maintains a reasonable financial structure with a Debt/Equity of 0.99 and positive TTM Free Cash Flow of $116M. However, profitability is deeply negative (TTM net margin -4.84%), revenue is declining (-6.68% YoY in Q4), and the stock is technically broken, down 23% over the past month.
Risks & Conditions: The two biggest risks are further margin compression eroding the cash flow base and negative developments in the Olin merger process. This Hold would upgrade to a Buy if the PS ratio falls below 0.25 (implying a price near $9.50) without a material worsening of fundamentals, or if Q3 2026 results show gross margin stabilization above 13% and a path to profitability. It would downgrade to a Sell if revenue declines another 5% sequentially or if the merger terms are revised to be more dilutive. The stock is undervalued on a historical and peer basis, but fairly valued given the current broken fundamentals and high uncertainty.
Sign up to view all
HUN 12-Month Price Forecast
The outlook is bifurcated between deep value and broken fundamentals. The base case of sideways trading is most probable (50%), as the extreme valuation discount should limit severe downside, but the lack of a near-term earnings catalyst and merger overhang will cap upside. The AI stance is Neutral with Medium confidence. The stance would upgrade to Bullish on confirmation of margin stabilization (gross margin >13.5% for two consecutive quarters) and merger clarity. It would downgrade to Bearish on a breakdown below the $10 technical level accompanied by another quarter of revenue decline >5%.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Huntsman Corporation's 12-month outlook, with a consensus price target around $13.81 and implied upside of +30.0% versus the current price.
Average Target
$13.81
9 analysts
Implied Upside
+30.0%
vs. current price
Analyst Count
9
covering this stock
Price Range
$9 - $14
Analyst target range
Analyst coverage for Huntsman is limited, with only 9 analysts providing estimates, and institutional ratings data shows a predominantly neutral to negative stance, including recent actions like JP Morgan's downgrade to Neutral from Overweight in February 2026. The consensus sentiment leans bearish, as evidenced by ratings such as 'Neutral', 'Equal Weight', 'Sector Perform', and an 'Underperform' from Mizuho, indicating a lack of conviction in a near-term recovery. No consensus price target or specific target range is provided in the data, which is a critical gap; the absence of such targets, coupled with the low analyst count, suggests limited institutional interest and high uncertainty, typical for a stock undergoing a major corporate event like a merger. The wide dispersion in analyst views and the lack of a clear price target signal high uncertainty around the stock's future, which can lead to elevated volatility and inefficient price discovery as the market awaits more clarity on the merger's final terms and strategic benefits.
Bulls vs Bears: HUN Investment Factors
The evidence currently favors the bear case, as fundamental deterioration (negative margins, revenue decline) and severe event risk from the Olin merger have triggered a justified repricing. However, the bull case is supported by an extreme valuation discount and a solid cash-generating balance sheet, which provide a tangible margin of safety. The single most important tension in the investment debate is whether the current valuation (PS of 0.30) already fully prices in the cyclical downturn and merger risks, or if further fundamental erosion and integration missteps could drive the stock toward its 52-week low of $7.30. The resolution of this tension hinges on the next few quarters of operational performance and merger clarity.
Bullish
- Extreme Valuation Discount: Huntsman trades at a trailing Price-to-Sales ratio of 0.30, a ~70% discount to typical chemical industry peers. This historically low multiple suggests the market is pricing in a worst-case scenario, leaving significant room for multiple expansion if fundamentals stabilize.
- Strong Balance Sheet & Cash Flow: Despite cyclical losses, the company generated $116M in TTM free cash flow and maintains a manageable Debt-to-Equity ratio of 0.99. The current ratio of 1.30 indicates sufficient liquidity to weather the downturn, providing a margin of safety.
- Deeply Oversold Technical Condition: The stock is trading at just 29% of its 52-week range ($11.41 vs. $7.30-$16.09) after a 23% one-month decline. This extreme oversold condition, with a 1-month relative strength of -20.25% to the S&P 500, often precedes a technical bounce, especially for a stock with a low beta of 0.66.
- Potential Merger Synergy Upside: The announced merger with Olin, while currently viewed negatively, could create a larger, more competitive entity with significant cost synergies. If integration proves successful, it could unlock long-term value not reflected in the current depressed price.
Bearish
- Severe Profitability Collapse: The company reported a Q4 2025 net loss of $96M, with a TTM net margin of -4.84% and negative ROE of -10%. Gross margin compressed to 12.1% in Q4 from 13.97% in Q3, indicating intense pricing pressure and poor operational efficiency.
- Merger Uncertainty & Dilution: The Olin merger announcement triggered a sharp sell-off, with the market perceiving the deal as dilutive to HUN shareholders. Analyst sentiment is bearish/neutral (JP Morgan downgrade to Neutral), reflecting high uncertainty and a lack of clear strategic rationale during a cyclical trough.
- Revenue Stagnation & Decline: Q4 2025 revenue of $1.355B declined 6.68% YoY, and quarterly revenue has stagnated below $1.5B. This lack of top-line growth momentum, amidst a weak chemical cycle, challenges any near-term earnings recovery narrative.
- High Short Interest: A short ratio of 6.77 indicates significant bearish speculative positioning. This creates a potential overhang and can exacerbate downward price moves, reflecting deep skepticism about the company's near-term prospects.
HUN Technical Analysis
The prevailing price trend for Huntsman has been a volatile but ultimately positive uptrend over the past year, with the stock posting a 1-year price change of +9.19%. However, the stock is currently trading at $11.41, which is near the lower end of its 52-week range of $7.30 to $16.09, positioning it at approximately 29% of this range. This low relative positioning, following a significant drop from recent highs, suggests the stock is in a deeply oversold condition, potentially representing a value opportunity but also reflecting severe negative sentiment, particularly following the merger announcement. Recent momentum has been decisively negative and diverges sharply from the longer-term trend; the stock has declined 23.11% over the past month and 9.87% over the past three months, indicating a severe breakdown in price action. This sharp reversal is corroborated by the stock's significant underperformance relative to the S&P 500, with a 1-month relative strength of -20.25%, signaling intense selling pressure and a likely repricing of risk around the Olin deal. Key technical support is clearly defined at the 52-week low of $7.30, while resistance sits at the recent high of $16.09. A breakdown below the $11 level, where the stock currently trades, could target the $7.30 low, whereas a recovery above the $15-$16 zone would signal the sell-off has been fully absorbed. The stock's beta of 0.658 indicates it is approximately 34% less volatile than the broader market, which historically provided some defensive characteristics but has not prevented the recent event-driven collapse.
Beta
0.66
0.66x market volatility
Max Drawdown
-38.7%
Largest decline past year
52-Week Range
$7-$16
Price range past year
Annual Return
+1.9%
Cumulative gain past year
| Period | HUN Return | S&P 500 |
|---|---|---|
| 1m | -30.8% | -1.3% |
| 3m | -18.4% | +14.0% |
| 6m | +6.2% | +9.5% |
| 1y | +1.9% | +20.9% |
| ytd | +4.2% | +9.5% |
Bobby - Your AI Investment Partner
Get real-time data, AI-driven personalized investment analysis to make smarter investment decisions
HUN Fundamental Analysis
Huntsman's revenue trajectory reflects the challenging conditions in the chemical cycle, with Q4 2025 revenue of $1.355 billion representing a year-over-year decline of 6.68%. The sequential trend from recent quarters shows volatility, with Q3 2025 revenue at $1.46 billion, Q2 at $1.458 billion, and Q1 at $1.41 billion, indicating revenue has stagnated in a tight band just below $1.5 billion, pointing to a lack of top-line growth momentum. The company's profitability is under severe pressure, as evidenced by a net loss of $96 million in Q4 2025 and a trailing twelve-month net margin of -4.84%. Gross margin was a thin 12.1% in the latest quarter, down from 13.97% in Q3 2025, highlighting significant margin compression amidst weak pricing and input cost pressures, which is particularly concerning for a chemical producer. The balance sheet and cash flow present a mixed picture; the company maintains a reasonable current ratio of 1.30 and a debt-to-equity ratio of 0.99, indicating manageable leverage. However, free cash flow over the TTM is a positive $116 million, and operating cash flow in Q4 2025 was $76 million, demonstrating the business can still generate cash internally. The negative Return on Equity of -10% and negative Return on Assets of -0.19%, however, underscore poor capital efficiency and the unprofitability of its current operations.
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
Open an Account, get $2 TSLA now!
Valuation Analysis: Is HUN Overvalued?
Given the company's negative net income, the primary valuation metric selected is the Price-to-Sales (PS) ratio. Huntsman currently trades at a trailing PS ratio of 0.30, which is exceptionally low and reflects the market's deep discount on its revenue base due to cyclical losses and merger uncertainty. A forward PE ratio of 53.51 is also cited, but this is based on a return to modest profitability and is less reliable given the current loss-making state. Compared to typical chemical industry peers, a PS ratio of 0.30 represents a significant discount, as many commodity chemical firms trade closer to 1.0x sales; this discount quantifies the market's skepticism about near-term earnings power and the value-destructive potential of the pending merger. Historically, the stock's own valuation has compressed dramatically; its current PS of 0.30 is near the very bottom of its multi-year range, having traded above 3.0x sales as recently as early 2024. Trading at such a depressed historical multiple suggests the market is pricing in a worst-case scenario of prolonged cyclical downturn and merger integration risks, leaving little room for further multiple contraction if fundamentals show any stabilization.
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
23.2x
Enterprise Value Multiple
Investment Risk Disclosure
Financial & Operational Risks: Huntsman faces significant financial risk from its collapsing profitability. The company reported a net loss of $96M in Q4 2025, with a trailing net margin of -4.84% and negative ROE of -10%. Gross margin compression to 12.1% in the latest quarter, down from 13.97% in Q3, highlights severe operational pressure. While the balance sheet is stable (Debt/Equity of 0.99), the business is currently value-destructive, burning through equity and dependent on a cyclical recovery to return to profitability. The high dividend yield of 8.46%, while attractive, may be unsustainable if cash flow weakens further.
Market & Competitive Risks: The primary market risk is valuation compression, but with a PS ratio of 0.30, this risk appears largely realized. The greater external threat is the pending merger with Olin, which introduces massive uncertainty regarding shareholder dilution, integration costs, and strategic rationale during an industry downturn. The stock's low beta of 0.658 offers little defense against this company-specific event risk, as evidenced by the 23% one-month drop. Competitive risks are elevated as a combined, weaker Huntsman may lose market share while integrating with Olin.
Worst-Case Scenario: The worst-case scenario involves the Olin merger failing to deliver promised synergies while distracting management, coupled with a prolonged chemical industry downturn that further erodes margins. This could lead to a dividend cut, credit rating downgrade, and a re-test of the 52-week low of $7.30. From the current price of $11.41, this scenario implies a downside of approximately -36%. The stock's maximum drawdown of -38.68% over the past year shows this magnitude of loss is within recent historical precedent.
FAQ
The key risks are, in order of severity: 1) Merger Execution Risk: The pending merger with Olin introduces massive uncertainty regarding dilution, integration costs, and strategic distraction, as reflected in the recent 23% sell-off. 2) Cyclical & Operational Risk: The company is currently unprofitable (TTM net margin -4.84%) with declining revenue (-6.68% YoY) and compressed gross margins (12.1%), indicating a severe industry downturn. 3) Sentiment & Technical Risk: High short interest (short ratio 6.77) and a lack of analyst coverage (only 9 analysts) can lead to exaggerated price moves and poor liquidity. 4) Dividend Sustainability Risk: The high 8.46% yield may be threatened if free cash flow, currently positive at $116M TTM, deteriorates further.
The 12-month forecast is highly uncertain, centered around three scenarios. The Base Case (50% probability) sees the stock trading between $11 and $13 as merger uncertainty persists and fundamentals stagnate. The Bull Case (25% probability), driven by successful merger integration and a cyclical upturn, targets a range of $15.50 to $16.09 (the 52-week high). The Bear Case (25% probability), triggered by worsening fundamentals or a bad merger outcome, sees the stock falling to a range of $7.30 (the 52-week low) to $9.00. The most likely outcome is the Base Case, as the company lacks a clear near-term catalyst to escape its current challenged state.
HUN is profoundly undervalued on a relative and historical basis. Its trailing Price-to-Sales ratio of 0.30 is near the bottom of its historical range and represents a steep discount to chemical industry peers, which often trade closer to 1.0x sales. This discount reflects the market's expectation of continued poor earnings and merger-related dilution. The forward P/E of 53.51, while high, is less meaningful given current losses. The valuation implies the market is pricing in a prolonged downturn and significant integration risk, leaving substantial upside for multiple expansion if operations stabilize.
HUN is a high-risk, high-potential-reward stock that is not a good buy for most investors at this time. For speculative value investors, the current Price-to-Sales ratio of 0.30 represents a compelling entry point if one believes the chemical cycle will recover and the Olin merger will be accretive. However, with negative profitability (TTM net margin -4.84%), a 23% one-month price decline, and significant merger uncertainty, the near-term path is fraught with risk. It could be a good buy for a patient, concentrated portfolio willing to accept a potential 36% drawdown to the 52-week low of $7.30 for the chance of a 35-40% rally if sentiment improves.
HUN is unsuitable for short-term trading due to its high event risk (merger), low analyst coverage, and recent extreme volatility (-23% in one month). Its low beta of 0.66 is misleading in this context. It is only suitable for long-term, patient investors with a minimum 2-3 year horizon who can wait for the chemical cycle to turn and the Olin merger integration to play out. The dividend provides a yield while waiting, but the primary thesis is a valuation recovery driven by improved fundamentals over years, not quarters. This is a deep-value, turnaround bet, not a tactical trade.