Huntsman Corporation Formulates Success

Every New York stock exchange trading day I'm posting a daily dividend stock or fund review. I'll share the three chief qualities of just one equity or fund that could be selected for a dividend stock portfolio I've named the Safari to Sweet Success.

This week the portfolio I'm building (my Safari To Sweet Success portfolio) seeks a high-yield and growing stock in the basic materials sector. 

That basic 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 company. The company's name is 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.

The company operates in four segments: Polyurethanes, Performance Products, Advanced Materials, and Textile Effects. 

The Polyurethanes segment offers polyurethane chemicals, thermoplastic polyurethane, propylene oxide, and methyl tertiary-butyl ether products. 

The Performance Products segment manufactures amines, maleic anhydrides, surfactants, linear alkyl-benzene, ethylene glycol, ethylene oxide, olefins, and technology licenses. 

The Advanced Materials segment offers epoxy, acrylic, and polyurethane-based polymers formulations; high-performance thermoset resins and curing agents; and base liquid and solid resins.

The Textile Effects segment provides textile chemicals, dyes, and inks. 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.

Huntsman Corporation was founded in 1970 and is headquartered in The Woodlands, Texas.

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

(1) Price

(2) Dividends

(3) Returns

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

No matter what, it's the first three primary traits that best tell whether a company has made, is making, and will make money. 

HUN Price

Huntsman's price was $32.99 per share at yesterday's market close. A year ago its price was $23.99 for a gain of $9 per share in the past year.  

Assuming Huntsman's price will continue to trade in the range of $25.00 to $45.00 next year, its price could grow another $9.00 from $32.99 to $41.99 by June 7, 2019. 

HUN Dividends

Huntsman's most recently declared quarterly dividend was $0.1625 per share payable in June. That $0.1625 quarterly dividend equates to an estimated annual payout of $0.65 for 2018 which yields 2% at yesterday's $32.99 closing stock price.  

Gains For HUN?

The $9.00 estimated year over year price gain plus an anticipated dividend of$0.65 makes a projected gross annual gain of $9.65 per share, which will be reduced by the costs to trade those shares.  

$1,000.00 invested today at the $32.99 price buys 30 shares. 

A $10 broker fee paid half at purchase and half at sale subtracts $0.33 per share.

Taking that $0.33 brokerage cost out of the estimated $9.65 gross gain per share leaves a net gain of $9.32 X 30 shares = $279.60 or a 28% potential net gain on a $989.70 investment.

Therefore, Huntsman Corporation (whose ticker symbol is HUN), now shows a possible 28% net gain including a 2% dividend yield. 

Ten analysts cover this stock:

Seven say "buy" HUN

One says HUN will "outperform."

Two say "hold" the stock.

The median analyst recommendation is 1.5 or "Outperform" and their median price target is $2 below the estimated year over year number I just calculated.

Y Charts rates HUN "neutral" for an overall "Y" rating. Y Charts also shows Good" for a Value score of 8 out of ten points. And YCharts ranks HUN "strong" with 8 out of 10possible Fundamental points. Y Charts Historic Valuation score is 60.7% overvalued, based on a $20.53 historic value multiple.

You could look at all those numbers like this: Huntsman Corporation (HUN) has made money, is making money, and could net a 20% to 28 %gain next year including a 2% dividend yield. It could be more, it could be less.

The above speculation is conjecture based on past year performance. Actual results remain to be seen. They could turn out to be far higher or lower. More study is required for you to determine if Huntsman Corporation (HUN) is worth your time and money.

Disclosure: Graphs and charts were compiled by Rydlun & Co., LLC from data derived from www.ycharts. com; www.finance.yahoo.com; analyst mean target price by Thomson/First Call in ...

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