Huntsman refinances its term loans
On November 15, 2016, Huntsman (HUN) announced that it had refinanced its term loan B due in 2021 and term loan B due in 2023. As per the new terms, Huntsman will pay an interest rate of LIBOR plus 2.8% for the new term loan B due in 2021 and an interest rate of LIBOR plus 3.0% for the new term loan due in 2023. After adding the LIBOR floor rate of 0.75%, the new term loans will carry an interest rate of 3.5% and 3.8%, respectively.
As a result of the term loan refinancing, Huntsman extended the term loan maturities and also saved on interest. Huntsman estimates that the refinancing of term loans will help in interest savings of approximately $4 million per year.
Huntsman announces dividend for 4Q16
On November 14, Huntsman declared a cash dividend of $0.125 per common share for 4Q16. The cash dividend has a pay date of December 30, 2016, with a record date of December 15, 2016.
Huntsman’s stock price jumps
As of November 18, 2016, Huntsman stock closed at $19.10 and rose 3.5% for the week. Huntsman outperformed the First Trust Materials AlphaDEX Fund (FXZ), which rose 2.0% for the same period. Huntsman stock traded 17.7% above the 100-day moving average price of $16.23. On a year-to-date basis, the stock has risen by a staggering 68.0%.
Investors can hold Huntsman indirectly by investing in the First Trust Materials AlphaDEX Fund, which has invested 2.4% of its portfolio in Huntsman as of November 18, 2016. The other top holdings of the fund include The Mosaic Company (MOS), USG (USG), and Packaging Corporation of America (PKG) with weights of 3.7%, 3.6%, and 3.4%, respectively.