10 Best Specialty Chemical Stocks To Buy Now

7. Hudson Technologies, Inc. (NASDAQ:HDSN)

Upside Potential: 34.71%

Number of Hedge Funds Holders: 19

Next on our list of the 10 Best Specialty Chemical Stocks To Buy Now, we have Hudson Technologies, Inc. (NASDAQ:HDSN), which provides solutions to the problems occurring in the refrigerants industry, along with manufacturing specialty gases. Established in 1991 with headquarters in New Jersey, the company is engaged in the sale of refrigerants that enhance cooling efficiency of coolants, providing reclamation management services.

Serving a wide range of commercial, governmental, and industrial customers, the company also provides chiller chemistry and Smart Energy OPS for energy optimization, particularly in refrigeration and air conditioning.

Hudson Technologies, Inc. (NASDAQ:HDSN) registered revenue of $75.3 million for the quarter ended on June 30, 2024, an increase from $65.3 million in the first quarter of 2024. Although the refrigerants prices fell for the second quarter, this was slightly offset by an increase in the number of units sold, a 17% increase in units sold. The refrigerant prices fell by 25% in the first half year of 2024 on YoY basis, along with lower revenue from the company’s contracts and reduced carbon credit revenue, which resulted in $0.20 diluted earnings per share (EPS), compared to $0.41 in the same quarter of the previous year. This led to a downward trajectory in the share price , making a low of $7.50 on a year-to-date basis.

However, the company has strengthened its balance sheet by ending the period with no debt, ensuring financial stability and autonomy. The share price has also rebounded and is currently trading at $8.10, as of the time of writing. The company has also reported $30.5 million in cash, which the board of directors is planning to invest in the repurchase of common stock valued at up to $10 million.

In June 2024, the company also announced the acquisition of all assets of USA United Suppliers of America for $20.7 million, which has been the country’s leading refrigerant distributor and purchaser of recovered refrigerant for over 25 years. With the phase-down of virgin refrigerants, this acquisition has given direct access to reclaimed products, which will be significant for the company to maintain its strong position. The acquisition will enhance the sourcing ability of recovered refrigerants, which is a high margin segment for the company due to market supply challenges.

Despite the falling refrigerant prices, the company’s strong cash position and acquisitions mean that analysts predict the stock has an upside potential of 34.71% from the current price. Therefore, 19 hedge funds are bullish on the stock as of Q2 2024.