Daily Stock Pick: Huntsman

This week, I'm looking for the seventh materials representative of nine for my Ivy portfolio.

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

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

Huntsman Corp is a US-based manufacturer of differentiated organic chemical products. The company's products are used in the adhesives, aerospace, automotive, construction products, among others.

Its operating segments are Polyurethanes, Performance Products, Advanced Materials and Textile Effects. It derives a majority of the revenue from the Polyurethanes segment which includes product used to produce rigid and flexible foams, as well as coatings, adhesives, sealants, and elastomers.

The company operates in the US and other countries, of which key revenue is derived from the US.

Huntsman Corporation was founded in 1970 and is headquartered in The Woodlands, Texas. I last reported on Huntsman Corporation August 28, 2018.

I use three key data points to gauge dividend-paying equities or funds like Huntsman Corporation:

(1) Price

(2) Dividends

(3) Returns

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

Those three basic keys, however, best tell whether a company has made, is making, and will make money.

HUN Price

Huntsman's price per share closed at $20.73 yesterday. A year ago its price was $30.86. Price fell $10.13 or 32.8% in the past year.

Assuming Huntsman's stock trades in the range of $15.00 to $30.00 this year, Huntsman's recent $20.73 price could rise by $3.27 and go to $24.00 by mid-July, 2020.

HUN Dividends

Huntsman's most recent quarterly dividend is $0.1625 paid June 28th.

That $0.1625 Q payout equates to an annual dividend of $0.65 which produces a yield of 3.14% based on yesterday's $20.73 closing price.

Gains For HUN?

Adding the $0.65 annual estimated dividend to my $3.27 estimate of Huntsman's price upside shows a $3.92 potential gross annual gain, per share, which will be reduced by costs to trade those shares.

Say we pay a little under $1,000.00 today at the $20.73 recent stock price, we'd buy 48 Huntsman Corporation shares.

A $10 broker fee paid half at purchase and half at sale will cost us $0.21 per share.

Subtract that $0.21 brokerage cost from the estimated $3.92 gross annual gain leaves a net gain of 3.71 X 48 shares = $178.08 or a 17.85% net gain on a $995.04 investment.

Therefore, Huntsman Corporation whose trading ticker symbol is HUN now shows a possible net gain of 17.85% including a 3.14% dividend yield.

Fourteen brokers track Huntsman Corporation stock:

Six say "Buy" HUN.

Four say HUN will "Outperform" its peers.

Three say "Hold" your HUN Shares.

One says HUN will "Underperform" its peers.

Their consensus score of 1.92 equates to "outperform."

Now we can look at Huntsman Corporation and see it has made money, is making money, and could net an 18.85% gain including a 3.14% dividend yield. It could be more, it could be less.

The above speculation is based on past year performance. The actual results remain to be seen to learn if  Huntsman Corporation is worth your time and money.

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