Materials

Report by Alembic Global Advisors

Hassan Ahmed is increasingly constructive on OLN, arguing that 1Q26 marked a positive inflection across all three segments after several years of estimate cuts and share price underperformance. Chlor-alkali fundamentals are tightening, helped by the cancellation of Chemours’ planned PCC chlorine project, limited North American capacity additions and Middle East-related disruptions, with an estimated 6-9% of global capacity currently shut. ECU pricing also appears to have stabilised after the post-2022 decline. Elsewhere, Epoxy returned to profitability after six consecutive quarterly losses, while Winchester is emerging from trough conditions as commercial ammunition stabilises and higher-visibility military exposure increases. With Beyond250 cost savings ramping, Hassan sees 2026 consensus expectations as undemanding and increases his 12-month TP to $36 (50% upside).

Report by MYST Advisors

MYST’s buyside events continue to deliver impressive performance (~19% avg. alpha on highlighted ideas at their previous Special Sits Forum). Their latest event featured a high number of potential takeouts / M&A plays, business separations, several Media stocks and various AI-related companies. The most compelling ideas included:

Chemours (CC US) - Refrigerant share gains + “free kicker” from steepening China TiO2 cost curve. TP $46 (110% upside).
ITT (ITT US) - High-quality pumps pure-play experiencing positive mix shift. TP $284 (45% upside).
Valmont Industries (VMI US) - “Non-obvious” AI infrastructure play benefitting from utility pole pricing inflection. TP $709 (35% upside).
Fundrise Innovation Fund (VCX US) - AI / Anthropic proxy trading at ~10x NAV with upcoming lock-up expiry catalyst. TP $50 (75% downside).

Materials

Report by Alembic Global Advisors

Sulfuric acid is becoming a binding constraint for TiO₂, with potential Chinese export curbs reinforcing an already tightening market. Acid prices have doubled y/y to ~$280/t, with recent moves of ~$140/t in 2026 alone, driving a ~$400/t increase in cash costs for sulfate-route producers - pushing marginal Chinese capacity into loss-making territory. With ~80-85% of China’s TiO₂ output reliant on sulfate processing, the system is highly exposed, meaning acid shortages translate directly into lost production rather than margin compression from the market’s key swing supplier. As acid is increasingly diverted towards fertilisers and battery materials, TiO₂ is pushed into a residual demand bucket - implying lower operating rates, periodic shutdowns and reduced export availability. With demand relatively inelastic in the near term, the setup is a classic supply shock, supporting sustained pricing upside and favouring chloride producers such as Chemours and Tronox.

Materials

Report by Alembic Global Advisors

The TiO₂ industry is emerging from a prolonged destocking cycle into the early stages of recovery, with demand normalising and lean downstream inventories - particularly in coatings - setting up a restocking-driven uplift through 2026. While share prices have already rebounded meaningfully YTD, Hassan Ahmed believes the magnitude of prior declines and improving fundamentals leave room for further upside as volumes recover and pricing firms. Pricing traction is building alongside tightening supply, with over 700kt of capacity closures since 2023 and mounting cost pressure in China supporting discipline. Additional upside could come from anti-dumping measures disrupting Chinese exports and shifting share to Western producers. Hassan highlights Tronox as his preferred name and raises his target price on Chemours.

Materials

Report by Alembic Global Advisors

Fears around demand destruction on the back of higher prices unfounded - Hassan Ahmed’s analysis suggests that a 50% boost in ore costs, all other costs remaining flat, could be offset by a 14% hike in TiO2 prices and a mere 4% hike in coatings prices. Current TiO2 prices are only slightly above their 17-year averages and 2008/2009 distress period-levels, while fundamentals remain healthy. Top pick is Tronox (benefits from higher TiO2 prices, but can also, via the firm's integration into feedstock ore, hold onto margin). Chemours and Venator also offer considerable upside.

Materials

Report by Alembic Global Advisors

Global economic stimulus, a weakening USD, rising vaccination rates and lean inventories are perfectly aligned for continued commodity chemical strength, with higher oil prices providing an additional tailwind. Multiple compression at Olin, Chemours, Huntsman and Tronox seems excessive, particularly when compared to earnings growth prospects. FCF yields at Venator, Braskem and Trinseo are very attractive. For 2022, Hassan Ahmed prefers companies that may benefit from activism/M&A-like catalysts (Braskem, Huntsman and Tronox), secular changes within their markets (Olin), or have underappreciated proforma earnings power (Trinseo and Westlake).

Materials

Report by Alembic Global Advisors

Current consensus expectations for the sector in Q3 still seem tepid, keeping in mind product margin gains and pricing strength. It is highly possible that companies under coverage will experience positive earnings revisions throughout 2021. Covestro AG, TP $73 (~25% upside); Chemours Company, TP $46 (~50% upside); Celanese Corp., TP $200 (~25% upside); Dow Inc, TP $85 (~45% upside)