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Huntsman (HUN) Q3 Earnings Match, Revenues Top Estimates

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Huntsman (HUN) Q3 Earnings Match, Revenues Top Estimates

Huntsman (HUN) is committed to balanced approach to capital allocation by growing its downstream businesses portfolio.

Huntsman Corporation HUN recorded net loss of $8 million or 5 cents per share in third-quarter 2018 against net income of $179 million or 60 cents recorded a year ago.

Barring one-time items, adjusted earnings were 84 cents per share in the quarter, in line with the Zacks Consensus Estimate.

Revenues totaled $2,444 million, up around 13% year over year on higher sales across all segments. The figure beat the Zacks Consensus Estimate of $2,239 million.

Huntsman Corporation Price, Consensus and EPS Surprise

 

Huntsman Corporation Price, Consensus and EPS Surprise | Huntsman Corporation Quote

 

Segment Highlights

Polyurethanes: Revenues at the segment rose around 13% year over year to $1,355 million on higher average selling price and sales volumes.

Performance Products: Revenues at the unit went up 20% to $599 million on an uptick in average selling prices and volumes.

Advanced Materials: Revenues at the unit increased around 6% to $279 million backed by higher average selling prices and volumes.

Textile Effects: Revenues at the division rose roughly 6% to $204 million buoyed by higher average selling prices that more than offset lower volumes.

Financials

Huntsman generated free cash flow of $226 million during the quarter, down slightly year over year. The company had $446 million of cash at the end of the quarter, down 1.1% year over year. Long-term debt was $2,277 million, down 20% year over year.

The company repurchased around 5.9 million shares worth roughly $175 million during the quarter.

Outlook

Huntsman noted that it continues to strengthen its balance sheet with net leverage improving to 1.3 times. The company is committed to a balanced approach to capital allocation by growing its downstream businesses portfolio while creating shareholder value.

The company also expects around $300-$320 million of capital expenditures this year. It expects adjusted effective tax rate for 2018 at around 19-21%.

Price Performance

Huntsman's shares have lost around 32.6% over the past year, compared with the industry’s fall of 21.1% .

 



Zacks Rank & Stocks to Consider

Huntsman currently carries a Zacks Rank #3 (Hold).

A few better-ranked stocks in the basic materials space are CF Industries Holdings, Inc. CF, KMG Chemicals, Inc. KMG and The Mosaic Company MOS.
 
CF Industries has an expected long-term earnings growth rate of 6% and a Zacks Rank #1 (Strong Buy). The company’s shares have gained 21.6% in the past year. You can see the complete list of today’s Zacks #1 Rank stocks here.

KMG Chemicals has an expected long-term earnings growth rate of 28.5% and a Zacks Rank #1. Its shares have risen 34.4% in a year’s time.

Mosaic has an expected long-term earnings growth rate of 7% and a Zacks Rank #2 (Buy). The company’s shares have rallied 34.4% in the past year.

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