Solutia (ticker symbol:SOA)is actually our closest competitor. They control 3% of the chemical market, whereas Chemtura controls 4%.
Solutia reported Q1 losses of 159 million or a loss of .05 cents per share. Chemtura had Q1 losses of 94 million or a loss of .11 cents per share. In contrast,DOW,which controls over 50% of the market posted a profit.
As such, I think Solutia is a better yardstick to measure Chemtura by. Solutia is currently trading at about $5.40, so I think a valuation of $1.20 for Chemtura is low balling.
Interestingly enough, New Market, which only has 1% market share is currently trading at about $64. They were actually cooking with gas with a Q1 45% increase in profit.
Anyway, fret not, the market will correct the valuation of Chemtura's stock price in due course. These daily ticks up and down are moot. Ultimately, the market and it's participants (bigger fish than us) will vault this stock up to it's correct valuation.
