Nomura initiated coverage on Huntsman Corporation HUN with a Buy rating and $30 price target.
Analyst Aleksey Yefremov claimed that the stock’s valuation “more than accounts for risks.”
Yefremov thought “the market has priced in an overly pessimistic downside case for HUN’s two key segments – Polyurethanes and Pigments (titanium dioxide white pigment).
“We think capacity additions in Polyurethanes are manageable, and while the Pigments business is challenged, we think it is worth more than the zero value currently ascribed to it by the market.”
Yefremov viewed “HUN as attractive for value-oriented investors as shares currently trade at 2015 EV/EBITDA of 5.8x, a discount to both commodity peers and diversified chemicals.”
The report set FY14E EPS at $2.02 and FY15E EPS at $2.75.
Huntsman recently traded at $21.83, up 2.49 percent.
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