HUN heads into its Q2 print today with a short position that has halved in size over the past month — yet remains elevated enough to keep the story interesting.
The most striking feature of the positioning setup is the dramatic unwinding of short interest since mid-June. Estimated shares short peaked near 29.4 million at the end of June and have since collapsed to roughly 17.4 million, a drop of more than 40% in a single month. That unwind has left short interest at 10% of the free float — still firmly in high-conviction bear territory, but the direction of travel is unmistakably toward the exit. The borrow market confirms there is no squeeze pressure: availability is extraordinarily loose at around 1,765% of current short interest, meaning roughly seventeen times as many shares are available to lend as are currently borrowed. Cost to borrow has also eased, running near 0.39% — down roughly 20% over the past month. The lending market is not punishing short sellers. What is notable, though, is the put/call ratio: at 0.53 against a 20-day average of 0.47, options traders have nudged modestly more defensive over the past two weeks, a shift that coincides with the stock's 5.8% weekly pullback to $12.07 after a 10% monthly gain.
The bull and bear cases are not so much opposed as they are competing timelines. Bulls point to the earnings momentum story: the EPS momentum factor ranked in the 100th percentile over the past 30 days, and the company has beaten estimates in a high proportion of recent reports, ranking in the 86th percentile on EPS surprise. Huntsman's differentiated MDI portfolio — roughly three-quarters of that business — gives it some insulation from pure commodity price swings, and any real recovery in construction or automotive demand would be a meaningful catalyst. Bears counter with a more structural argument: global polyurethanes and MDI markets remain oversupplied, Asian product flows into South America continue to pressure pricing, and EBITDA estimates for the full year have been revised down materially. Analyst sentiment reflects that tension, with the Street clustered around neutral-to-underperform ratings. Mizuho trimmed its target to $13 at the start of July after upgrading the stock in mid-June, while BofA Securities, which carries an Underperform, actually nudged its target up to $11. The consensus mean of $13.50 sits only 12% above the current price — modest implied upside for a stock trading below book value (price-to-book near 0.77) and with a P/E ratio inflated by near-zero near-term earnings.
Among peers, HUN is not alone in its weekly weakness. OLN fell 8.5% on the week while TROX dropped a similar 8.5%, and ASIX shed nearly 8%. EMN fared better, losing only 3%. The weakness appears sector-wide, which reduces the signal from HUN's individual move but also suggests today's print will land in a market already pricing in chemical-sector stress. One notable institutional development: T. Rowe Price filed a new position of nearly 8 million shares as of June 30, making it a top-five holder — a meaningful endorsement of the value case even as the short side remains well-populated.
The print will test whether the EBITDA recovery story is arriving on the schedule bulls envisioned, or whether the oversupply headwinds the bears cited are taking longer to clear than the recent short-covering rally implied.
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