Huntsman's Price Target Trimmed: What's Next for Investors?

Wells Fargo recently lowered its price target for Huntsman Corporation (HUN) to $25 from $26, reflecting a more cautious outlook on the global economy and its impact on the company's core markets. This article explores the factors behind the price target reduction and its implications for Huntsman's stock performance and investor sentiment.

Huntsman, a global manufacturer and marketer of differentiated and specialty chemicals, operates in three segments: Polyurethanes, Performance Products, and Advanced Materials. The company's products are used in a wide range of applications, including adhesives, aerospace, automotive, construction, and electronics, among others.

Wells Fargo's decision to lower its price target comes amid a challenging macroeconomic environment and industry trends. The global chemical industry has been facing headwinds due to slowing economic growth and trade tensions. Additionally, Huntsman's core markets, such as construction and industrial, have been experiencing trough conditions. These factors have likely contributed to Wells Fargo's decision to trim its price target.

Despite the price target reduction, Huntsman's fundamentals remain solid. The company reported third quarter 2024 revenues of $1,540 million, a decrease from the prior year period, and a net loss attributable to Huntsman of $33 million. Adjusted net income also decreased to $17 million from $27 million in the prior year period. However, the company's total volumes increased by 5% compared to the prior year, with stable margins sequentially.

Huntsman's management strategy and execution have played a significant role in Wells Fargo's assessment of the company's future prospects. The company's focus on improving cost position and balance sheet strength, as mentioned by Peter R. Huntsman, Chairman, President, and CEO, in the third quarter 2024 results, has likely led to the price target adjustment. While the new price target reflects a more conservative outlook, the "Equal-Weight" recommendation suggests that analysts maintain a neutral stance on the stock.

The new price target of $25 at Wells Fargo lowers Huntsman's forward P/E ratio to approximately 18.70, based on the projected EPS of $1.12 for 2025. This places Huntsman in line with its industry peers, such as Dow Inc. (DOW) at 18.65 and LyondellBasell Industries (LYB) at 18.94. Despite the reduction, Huntsman's valuation remains attractive, considering its strong balance sheet and cash flow generation.


The change in price target may have short-term implications for investor sentiment, potentially leading to a slight decrease in the stock price due to reduced buying interest from those who follow Wells Fargo's recommendations. However, the long-term impact is likely to be minimal, as the new price target still represents a 23.32% increase from the current stock price of $20.88. Moreover, the average price target of $25.75 from eight analysts suggests that the majority of the Street maintains a bullish outlook on Huntsman's long-term prospects.

Huntsman's successful bond offering in Q3 2024 and its focus on improving cost position and balance sheet strength further support its long-term growth potential. The company's strong fundamentals, combined with its strategic positioning in the global chemical industry, make it an attractive investment opportunity for those seeking undervalued opportunities with strong growth potential and solid fundamentals.


In conclusion, Wells Fargo's decision to lower its price target for Huntsman reflects a more cautious outlook on the global economy and its impact on the company's core markets. Despite this, Huntsman's fundamentals remain solid, and its long-term prospects remain promising. Investors should consider the company's strong balance sheet, cash flow generation, and strategic positioning in the global chemical industry when evaluating its investment potential.