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Huntsman Corporation (NYSE:HUN) is a stock with outstanding fundamental characteristics. When we build an investment case, we need to look at the stock with a holistic perspective. In the case of HUN, it is a financially-sound company with a great track record high-grade dividend payments, trading at a great value. Below, I've touched on some key aspects you should know on a high level. For those interested in digging a bit deeper into my commentary, take a look at the report on Huntsman here.
Very undervalued established dividend payer
HUN's ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This indicates that HUN has sufficient cash flows and proper cash management in place, which is a key determinant of the company’s health. HUN's has produced operating cash levels of 0.3x total debt over the past year, which implies that HUN's management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings. HUN's shares are now trading at a price below its true value based on its discounted cash flows, indicating a relatively pessimistic market sentiment. This mispricing gives investors the opportunity to buy into the stock at a cheap price compared to the value they will be receiving, should analysts' consensus forecast growth be correct. Compared to the rest of the chemicals industry, HUN is also trading below its peers, relative to earnings generated. This supports the theory that HUN is potentially underpriced.
Income investors would also be happy to know that HUN is a great dividend company, with a current yield standing at 3.4%. HUN has also been regularly increasing its dividend payments to shareholders over the past decade.
For Huntsman, I've put together three fundamental factors you should further research:
- Future Outlook: What are well-informed industry analysts predicting for HUN’s future growth? Take a look at our free research report of analyst consensus for HUN’s outlook.
- Historical Performance: What has HUN's returns been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of HUN? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.