Analyst Michael Sison of Wells Fargo maintained a Buy rating on Dow Inc (DOW – Research Report), with a price target of $59.00.
Michael Sison’s Buy rating for Dow Inc’s stock is grounded on a variety of contributing factors, including the company’s performance and future expectations. In the fourth quarter of 2023, Dow showcased a commendable volume growth of 2%, resulting in earnings per share that exceeded both Wells Fargo’s estimates and the consensus. Despite a year-over-year decline in sales, Dow still managed to surpass Sison’s sales estimate and their own provided guidance. Additionally, the company’s EBITDA margins improved compared to the previous year, and the cash flow from operations saw a significant increase, further bolstering confidence in the company’s financial health.
Looking ahead, Sison is optimistic about Dow’s EBITDA growth trajectory towards a $2 billion annual increase by the mid-decade, with a notable portion already realized. This growth is expected to be driven by strategic investments in performance-enhancing polymers and capacity expansions in key areas such as alkoxylates, silicones, and coatings. Furthermore, Dow’s ongoing operational investments are anticipated to contribute to the growth momentum through asset reliability enhancements and an improved product mix aimed at higher margins. These factors collectively justify the Buy rating as they underscore Dow’s potential for continued financial improvement and shareholder value creation.
In another report released on January 16, Bank of America Securities also upgraded the stock to a Buy with a $60.00 price target.
DOW’s price has also changed slightly for the past six months – from $53.480 to $54.940, which is a 2.73% increase.
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Dow Inc (DOW) Company Description:
Incorporated in 2018, Michigan-based Dow, Inc. provides materials science solutions for consumer care, infrastructure, and packaging markets in the United States, Canada, Europe, the Middle East, Africa, India, the Asia Pacific, and Latin America. It operates through three segments: Packaging & Specialty Plastics, Industrial Intermediates & Infrastructure, and Performance Materials and Coatings.
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