Midland, Michigan-based Dow Inc. (DOW) is one of the world’s leading materials science companies, providing a world-class portfolio of advanced, sustainable and leading-edge products. Valued at $29.1 billion by market cap, Dow operates manufacturing sites in 31 countries and employs approximately 35,900 people worldwide.
Companies worth $10 billion or more are generally described as "large-cap stocks," Dow fits this bill perfectly. Given the company’s extensive operations and presence in high-growth markets such as packaging, infrastructure, mobility and consumer applications, its valuation above this mark is not surprising.
Despite its notable strengths, Dow has plunged 32% from its 52-week high of $60.69 achieved on Apr. 4. Dow has declined 17.9% over the past three months, lagging behind the Nasdaq Composite’s ($NASX) 13.3% gains during the same time frame.
Over the longer term, Dow’s performances look even more concerning. Dow has plummeted over 24.7% on a YTD basis and 18.8% over the past 52 weeks, underperforming NASX’s 32.6% gains in 2024 and 37% surges over the past year.
To confirm the bearish trend, Dow has traded below its 50-day moving average since late May and below its 200-day moving average since late June with minor fluctuations.
Dow’s stock prices dipped nearly 1% after the release of its Q3 results on Oct. 24. The company has been battling the ongoing macroeconomics softness in the past quarters which has affected its growth potential. Furthermore, Europe and China haven't shown any major signs of recovery yet. Nevertheless, the company has shown resilience and continued to report volume growth over the past four quarters. Its Q3 revenues grew by a modest 1.4% year-over-year to approximately $10.9 billion. However, due to rising expenses and margin contraction, its net income to common shareholders plunged 29.1% year-over-year to $214 million.
Despite its underperformance compared to the broader market, Dow has outperformed its peer Celanese Corporation’s (CE) 55.7% decline on a YTD basis and 51.3% dip over the past year.
Among the 19 analysts covering the DOW stock, the consensus rating is a “Moderate Buy.” The mean price target of $54.50 represents a 32% premium to current price levels.
