Star Pick In Basic Materials: Huntsman

This week I'm seeking a high-yield and growing stock from the basic materials sector. 

That materials sector includes thirteen industries all related to mining, making and delivering essential commodities. The industries are: agricultural inputs; aluminum; building materials; chemicals; coal; copper; industrial metals and minerals; paper; silver; specialty chemicals; steel.

Today I'm reviewing a mid-cap chemicals firm named Huntsman Corporation.  Its trading ticker symbol is HUN.

Huntsman Corp acts as a manufacturer of differentiated organic chemical products and of inorganic chemical products. Its products mainly comprise a broad range of chemicals and formulations which are used in various applications. Through its subsidiary Huntsman International LLC, it manufactures and sells differentiated organic chemical products worldwide. The company operates in four segments: Polyurethanes, Performance Products, Advanced Materials, and Textile Effects. 

The company's products are used in various applications, including adhesives, aerospace, automotive, construction products, personal care and hygiene, durable and non-durable consumer products, electronics, medical, packaging, coatings and construction, power generation, refining, synthetic fiber, textile chemicals, and dye industries. Huntsman Corporation was founded in 1970 and is headquartered in The Woodlands, Texas.

I use three key data points to gauge the value of any dividend equity or fund like  Huntsman Corporation (HUN): 

(1) Price

(2) Dividends

(3) Returns

Besides those three, four more keys  will finally unlock an equity or fund in which to invest.

But those first three primary keys, best tell whether a company has made, is making, and will make money. 

HUN Price

Huntsman's  price per share was $32.73 at yesterday's market close.  A year ago its price was $26.67 for a gain of $6.06 per share.  

Assuming Huntsman's price will trade in the range of $25 to $40 next year, perhaps that $6 gain could be realized again in the coming year and move Huntsman's current $32.73 price to $38.79 by late-August, 2019. 

HUN Dividends

Huntsmans most recent quarterly dividend was $0.1625  declared August 9th and payable September 28th. At this most recent quarterly pay rate, Huntsman's annual dividend is calculated at $0.65 yielding 2% at yesterday's closing $32.73 price.

Gains For HUN?

Adding the $0.65 estimated annual dividend to the $6.06 year over year price gain for Westlake makes a $6.71  gross annual per share gain, which will be reduced by costs to trade the shares.  

A little over $1,000.00 invested today at the $32.73 recent price buys 31 Huntsman Corporation (HUN) shares. 

A $10 broker fee paid half at purchase and half at sale costs $0.32 per share

Subtracting that $0.32 brokerage cost from the estimated $6.71 gross gain leaves a net gain of $6.39 X 31 shares 

= $198.09

or a 19.5% net gain on a $1,014.63 investment.

Therefore, HUN now shows a possible 19.5% net gain including a 2% dividend yield. 

Eleven brokers cover this stock:  Seven say "buy" HUN. Two say WLKP will "outperform" its peers. Two say "hold" HUN.

Thus, the analyst consensus recommendation number is 1.5 or "outperform".

The median price target set by those eleven brokers is $0.96 over the $38.79 year over year price target I named. 

So, you could look at all those numerous numbers this way: Huntsman Corporation has made money, is making money, and could net a 19.5% net annual gain including a 2% dividend yield. It could be more, it could be less.

The above speculation is based on past year performance. Actual results remain to be seen.  Those results will determine if Huntsman Corporation (HUN) is worth your time and money.