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Fly News Breaks for November 27, 2019
KRA
Nov 27, 2019 | 10:42 EDT
Loop Capital analyst Chris Kapsch noted that media reports indicate there was an explosion and fire at the Port Neches, Texas facility of privately-held TPC Group, where he believes the company produces butadiene, or BD. The market typically reacts to disruptive events like this by sending spot prices higher, said Kapsch, who expects that to happen with BD in this case. BD is a key input, and he believes the single largest input, for Kraton's production of its SBC polymers, said the analyst, who notes that "the stock market has tended to be punative" to Kraton shares in the past when there has been volatility in BD prices. He assumes Kraton share could see some volatility as a result of the TPC plant fire news, but would view any sustained pressure on the stock as a buying opportunity, said Kapsch, who keeps a Buy rating on Kraton shares.
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