UPDATE: Citigroup Upgrades Huntsman to Buy on US Construction Strength

Citigroup raised its rating on Huntsman

from Neutral to Buy and increased its price target from $17 to $20. Citigroup noted, "HUN shares were surprisingly resilient in 2012 despite decelerating Pigments earnings on lower TiO2 prices, subdued demand and high inventory levels. This leads us to conclude that TiO2 downside has been factored into the share price. We also give credit to management for being the first to call out weakness in TiO2 amid destocking and margin pressure from the expiration of legacy annual titanium ore price contracts. To be sure, the company faces TiO2 headwinds in 1H13, partially offset by ongoing restructuring initiatives. Our upgrade thesis is based on a 12-month timeframe with benefits for patient investors willing to wait out the TiO2 destocking cycle." Huntsman closed at $16.25 on Wednesday.