Kraton stock soars 27% after company says it may sell Cariflex business

Chemicals company Kraton Corp. shares soared 27% Tuesday, putting them on track for the biggest one-day percentage gain since the company went public in 2009, after it said it may sell its Cariflex business and unveiled a share buyback program of up to $50 million. Houston, Tx.-based Kraton, which makes polymers used in adhesives, coatings, consumer and personal care products, said it has launched a strategic review of Cariflex, which makes products for the health care industry. The high-margin business has attractive growth prospects that "are not appropriately valued as part of Kraton," Chief Executive Kevin M. Fogarty said in a statement. Proceeds of any deal would be used to pay down debt, he said. Kraton will release fourth-quarter earnings on Feb. 27 and is still expecting adjusted EBITDA of about $380 million, excluding impacts from Hurricane Michael. Shares have gained 69% in 2019 so far, while the S&P 500 has gained about 3%.

Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.