Ashland (ASH) stock is soaring 5.10% in intraday trading on Wednesday, despite reporting a decline in fourth-quarter sales. The company's ability to improve profitability metrics seems to be resonating well with investors.

Ashland reported Q4 fiscal year 2025 sales of $478 million, an 8.0% decrease from the same period last year. However, the company managed to increase its gross profit margin to 35.8% from 34.3%, and its EBITDA margin improved to 24.9% from 23.8%. These improvements in profitability metrics appear to be driving the positive stock movement.

While the company faced challenges, including an 8% decline in sales and a 14% decrease in earnings per share (excluding acquisition amortization), the market seems to be focusing on Ashland's ability to maintain stable underlying organic volumes and improve margins in a challenging environment. The company's ongoing free cash flow was $52 million, down 41% year-over-year, but investors may be viewing the overall financial picture as resilient given the current economic conditions.