Top Performer for Tuesday: Ashland (ASH)

Shares of Ashland Inc. (ASH - Snapshot Report) have gained more than 5% during this lackluster session, which is enough to make this specialty chemicals company a top-performing Zacks #1 Rank.

ASH is 1 of only 3 companies from the chemicals - diversified industry on today's Zacks #1 Rank List, which includes 224 stocks in total. The other 2 companies are Koppers Holdings Inc. (KOP - Snapshot Report) and Stepan Company (SCL).

Estimates Remain Higher Than 2 Months Ago

The past month hasn't seen much movement in earnings estimates for this fiscal year, ending September 2009. In fact, the consensus has only moved higher by a penny in that time. However, the level remains approximately 60% better than expectations from 2 months back.

Meanwhile, estimates for the fiscal year ending September 2010 have advanced 3 cents in the past week, but more than 50% in the past 2 months.

Analysts currently expect $2.69 per share for next fiscal year, which is higher by about 6.3% from this fiscal year.

Making a Sale

Recently, ASH announced that it will sell its global marine services business to J.F. Lehman & Co. for about $120 million before tax. The company said that its after-tax proceeds will be used to reduce debt.

The business, which was known as Drew Marine, has revenues of about $140 million a year and has about 325 employees.

"For Ashland, this reflects our strategy to strengthen our core specialty chemical businesses while reducing our investment in non-core or non-strategic businesses," said Chairman and CEO James J. O'Brien.

Beat by More Than 100%

In late April, ASH provided the results for a very challenging fiscal second quarter, which was impacted by a very soft demand environment. The company reported 65 cents per share, which declined on a year-over-year basis. However, the result surpassed Wall Street's expectations by nearly 110%.

Revenue declined to $1.99 billion.

"We expect to navigate this economic downturn and create value for our stakeholders by effectively managing our pricing, aggressively reducing our costs, and applying the cash we generate to reducing debt," said O'Brien.

During the quarter, ASH generated $220 million of cash flows from operating activities and paid down $206 million of debt.