At the latest close, Dow Inc. (DOW) reached $53.51, reflecting a -0.48% move from the previous day. The stock outperformed the S&P 500, which recorded a daily loss of 0.6%. The Dow, meanwhile, recorded a decline of 0.39%, and the tech-dominated Nasdaq recorded a decline of 1.12%.
Materials Science stocks rose 0.15% month-over-month, lagging the Basic Materials sector’s gain of 1.32% and the S&P 500’s gain of 3.15%.
Investors will be eagerly awaiting Dow Inc.’s performance on its upcoming earnings release. On that day, Dow Inc. is expected to report earnings of $0.69 per share, representing year-over-year growth of 43.75%. In addition, our latest consensus estimate is calling for revenue of $11.02 billion, representing an increase of 2.66% from the year-ago quarter.
For the full fiscal year, the Zacks Consensus Estimates are projecting earnings of $2.63 per share and revenue of $43.23 billion, representing year-over-year changes of +17.41% and -3.12%, respectively.
In addition, investors should pay attention to recent changes in analyst forecasts for Dow Inc. Such recent changes usually indicate a change in near-term business trends. Consequently, upward revisions to forecasts express analysts’ positive view of the company’s business operations and its ability to generate profits.
Empirical research shows that these estimate changes are directly related to upcoming stock price movements. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and provides a clear, actionable rating model.
The Zacks Rank system, which varies from #1 (Strong Buy) to #5 (Strong Sell), has an impressive track record of exceeding expectations, as validated by outside audits. Stocks ranked #1 have delivered an average annual return of +25% since 1988. Over the past 30 days, the Zacks Consensus Estimate for earnings per share has moved 1.68% lower. Dow Inc. currently holds a Zacks Rank of #5 (Strong Sell).
In terms of valuation, Dow Inc. is currently trading at a P/E ratio of 20.42, which represents a premium to the industry average P/E ratio of 18.69.
We can also see that DOW currently has a PEG ratio of 0.96. The PEG ratio is similar to the commonly used P/E ratio, but this value also takes into account the company’s expected earnings growth rate. As of yesterday’s close, the Chemicals – Diversified industry had an average PEG ratio of 1.15.
The Chemicals – Diversified industry is part of the Basic Materials sector. This group has a Zacks Industry Rank of 225, putting it in the bottom 12% of all 250+ industries.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within those groups. Our research shows that the top 50% of industries outperform the bottom half by a factor of 2 to 1.
Use Zacks.com to stay on top of all these and other stock-changing metrics in upcoming trading sessions.
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