At US$27.06, Is It Time To Put Huntsman Corporation (NYSE:HUN) On Your Watch List?
Huntsman Corporation (NYSE:HUN), is not the largest company out there, but it saw a double-digit share price rise of over 10% in the past couple of months on the NYSE. As a mid-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. But what if there is still an opportunity to buy? Let’s take a look at Huntsman’s outlook and value based on the most recent financial data to see if the opportunity still exists.
Check out our latest analysis for Huntsman
What's The Opportunity In Huntsman?
Good news, investors! Huntsman is still a bargain right now. My valuation model shows that the intrinsic value for the stock is $41.68, but it is currently trading at US$27.06 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, Huntsman’s share price is quite volatile, which gives us more chances to buy since the share price could sink lower (or rise higher) in the future. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.
Can we expect growth from Huntsman?
Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. However, with an extremely negative double-digit change in profit expected over the next couple of years, near-term growth is certainly not a driver of a buy decision. It seems like high uncertainty is on the cards for Huntsman, at least in the near future.
What This Means For You
Are you a shareholder? Although HUN is currently undervalued, the adverse prospect of negative growth brings about some degree of risk. I recommend you think about whether you want to increase your portfolio exposure to HUN, or whether diversifying into another stock may be a better move for your total risk and return.
Are you a potential investor? If you’ve been keeping an eye on HUN for a while, but hesitant on making the leap, I recommend you research further into the stock. Given its current undervaluation, now is a great time to make a decision. But keep in mind the risks that come with negative growth prospects in the future.
So while earnings quality is important, it's equally important to consider the risks facing Huntsman at this point in time. Our analysis shows 2 warning signs for Huntsman (1 makes us a bit uncomfortable!) and we strongly recommend you look at these before investing.
If you are no longer interested in Huntsman, you can use our free platform to see our list of over 50 other stocks with a high growth potential.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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