Smart Money Ratings For 20 Most Undervalued Stocks

12. Ashland Inc. (NYSE:ASH)

Insider Transaction: 6.63%

Upside Potential: 37.63%

Forward P/E: 10.36

A global specialty chemicals company, Ashland Inc. (NYSE:ASH), delivers high-performance solutions to various industries, including personal care, pharmaceuticals, food, and energy. The company specializes in additives, rheology modifiers, and film coatings in Delaware. Peers like Dow and BASF pose tough competition in the market. However, Ashland Inc. (NYSE:ASH) stands out from them in terms of scientific innovation and regulatory compliance. Particularly, the company’s transformation from a diversified industrial firm to a focused specialty player ensures stability in its margin.

Ashland Inc. (NYSE:ASH) has rebounded 7.40% from its lowest point this year. The second quarter sales were down by 17% year-over-year. In addition to the decline in organic sales volume, portfolio optimization also contributed to this fall in sales. However, portfolio optimization, such as the sale of the Avoca business, is anticipated to increase the company’s long-term profitability. Life Sciences and Personal Care segments are performing well, simultaneously achieving a record-high EBITDA margin of more than 30%. With new facilities in China and Brazil, Ashland Inc. (NYSE:ASH) is also pursuing growth in the global market.

The stock could be considered undervalued relative to earnings expectations since it is trading at a forward P/E of 10.36. The company possesses notable internal faith, which is reflected in the 6.63% rise in insider activity in the past 6 months. Though hedge fund involvement stands moderate at 24 holders, the 37.63% upside potential estimated by analysts increases the company’s attractiveness for those seeking undervalued stocks.