With a market cap of $27.6 billion, Dow Inc. (DOW) is a leading materials science company, specializing in advanced, sustainable solutions for diverse industries, including packaging, infrastructure, mobility, and consumer care. Dow stands out as a leader in innovation and competitive advantage with the world's largest ethylene cracker in Freeport, Texas, and a strong global manufacturing presence. The Midland, Michigan-based company is expected to announce its fiscal Q4 earnings results before the market opens on Thursday, Jan. 30.
Ahead of the event, analysts expect the materials science company to report a profit of $0.32 per share, down 25.6% from $0.43 per share in the same quarter last year. The company has surpassed Wall Street's bottom-line estimates in three of the past four quarters while missing on another occasion. In the most recent quarter, DOW exceeded the consensus EPS estimates by a 2.2% margin.
For fiscal 2024, analysts expect DOW to report an EPS of $2.04, down 8.9% from $2.24 in fiscal 2023. However, the company is expected to rebound in fiscal 2025 with a robust 41.7% year-over-year growth, reaching an EPS of $2.89.
Over the past 52 weeks, DOW has dropped 29.5%, underperforming both the S&P 500 Index's ($SPX) nearly 24% rise and the Materials Select Sector SPDR Fund's (XLB) 1.1% decrease over the same period.
Despite reporting better-than-expected Q3 adjusted earnings of $0.47 per share and net sales of $10.9 billion, shares of DOW fell nearly 1% on Oct. 24. The decline was driven by weakness in the Industrial Intermediates & Infrastructure segment, where sales dropped to $2.96 billion, missing the estimate. Additionally, the company faced headwinds from an unplanned cracker outage in Texas and higher planned maintenance activity, which impacted investor sentiment. Furthermore, cash flow from operating activities declined significantly to $800 million, raising concerns.
Analysts' consensus view on DOW stock is cautiously optimistic, with an overall "Moderate Buy" rating. Among 19 analysts covering the stock, four recommend a "Strong Buy" and 15 give a "Hold" rating. As of writing, DOW is trading below the average analyst price target of $51.17.
