Huntsman (NYSE:HUN) stock is displaying indomitable strength this year. Having gained 17% year to date as of this writing, the stock handily beats DuPont's (NYSE:DD) 7% up move, even as it closes in on Dow Chemical's (NYSE:DOW) 20% year-to-date gains. What's notable is the rapid pace at which Huntsman caught up with peer stocks – It was hugely underperforming both competitors before jumping 15% last month.

So, what set Huntsman shares on fire, and what is the potential upside from here?

Excitement on the Street
One of the major factors behind Huntsman's rally is the recent analyst upgrades. Jefferies Group, UBS, and Goldman Sachs are just some of the research companies that have turned bullish about the chemical maker in recent weeks. Goldman has a price target of $32 on Huntsman; Jefferies sees the stock hitting $35 within the next 12 months.

There's a lot going on  inside Huntsman that's keeping analysts on their toes. Here are four key developments worth noting.

Massive growth plans
During its Investor Day held this past March, Huntsman revealed ambitious plans to boost its adjusted earnings before interest, taxes, depreciation, and amortization, or EBITDA, to $2 billion by 2016. That represents substantial upside from the $1.2 billion it earned last year.

While its largest business of polyurethanes will be an important contributor, Huntsman is pegging the biggest portion of its EBITDA growth -- nearly $460 million -- to come from its titanium dioxide, or TiO2 business. The company's big expansion plans for both businesses have caught analysts' attention.

Valuable white pigment
Huntsman sent the markets into a tizzy last year when it announced plans to acquire Rockwood Holdings' performance additives and TiO2 business for $1.1 billion. TiO2 is an essential pigment for several products, including paints and coatings, plastics, paper, cosmetics, and medicines. The deal will make Huntsman the world's second-largest TiO2 producer, by capacity, after DuPont.

The stands at Maracana Stadium, Brazil have Huntsman's polyurea coating. Source:Huntsman

Huntsman is currently awaiting the regulatory approval of the European Commission, which should announce its decision by next month. Huntsman expects the acquisition to add $0.60 to its 2014 earnings per share. Its goal is to spin off the total pigments business within the next couple of years.

If Huntsman's projections hit the bull's eye, the share of its TiO2 business in adj. EBITDA will jump to 29% from its current 8% within the next two to three years. While I have my reservations about Huntsman's plans to expand its TiO2 business, those EBITDA projections, and improving TiO2 industry conditions, are enough to excite investors and analysts.

The real money churner
Huntsman's strong and resilient polyurethanes business has also fuelled analysts' optimism. Polyurethanes contributed 44% and 53% to Huntsman's revenue and adj. EBITDA, respectively, last year. Polyurethane foams containing MDI chemical are widely used in insulation, construction, automotive, and packaging industries.

Huntsman projects global demand for MDI to grow at a compounded average rate of 8% through 2015. But competition is intense, especially with Dow Chemical building the world's largest petrochemical facilities with focus on polyurethanes in Saudi Arabia. Dow Chemical is targeting annual revenue of $10 billion from the facility; that's twice what Huntsman generated from its polyurethanes business last year.

Nevertheless, Huntsman already enjoys a strong lead over Dow Chemical as the world's third-largest MDI company by capacity (behind Bayer and BASF), with 18% share in the global MDI market. Dow is fifth on the list, with 12% share under its belt. And to ensure that it remains at the forefront, Huntsman is spending more than $1.5 billion on expansion projects in China, which is expected to emerge as the biggest MDI market by 2020 with 40% share in global demand. The huge growth potential has given analysts a good reason to be bullish about Huntsman.

A strong case of management efficiency
While seizing growth opportunities in its key businesses, Huntsman's restructuring efforts for its textile effects and advanced materials divisions are starting to pay off. The businesses together accounted for roughly 20% of the company's total revenue last year.

Araldite adhesive is a key Advanced materials product. Source: Huntsman

If adj. EBITDA margin for its advanced materials division -- which specializes in epoxy resins -- improved three percentage points, to 10% in 2013, its textile effects business generated an adj. EBITDA margin of 2% last year compared to negative 3% margin in 2012. Judicious cost cutting helped Huntsman swing to a profit of $54 million in its first quarter from last year's Q1 loss of $24 million despite a small 2% improvement in revenue.

Here's an interesting tidbit for you: According to a Bloomberg report, Huntsman may even consider selling its textile business if it doesn't pick up speed. The company follows a simple, yet effective, strategy: Do away with portions that don't add value.

What's next?
Growth catalysts are aplenty, and Huntsman is building a strong foundation for itself by working on its weaknesses, and turning its challenges into opportunities. The stock's recent rally may spook some, but long-term investors should be happy that Huntsman belongs in their portfolio. The company has what it takes to conquer new heights, and give you your dues as a shareholder.