Dow Inc. (DOW) Gains But Lags Market: What You Should Know
Dow Inc. (DOW) closed at $50.91 in the latest trading session, marking a +0.85% move from the prior day. This change lagged the S&P 500's 1.76% gain on the day. At the same time, the Dow added 1.17%, and the tech-heavy Nasdaq gained 3.03%.
Coming into today, shares of the materials science had lost 15.53% in the past month. In that same time, the Basic Materials sector lost 7.76%, while the S&P 500 lost 5.94%.
Wall Street will be looking for positivity from Dow Inc. as it approaches its next earnings report date. The company is expected to report EPS of $0.46, down 80.34% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $11.37 billion, down 25.51% from the prior-year quarter.
For the full year, our Zacks Consensus Estimates are projecting earnings of $3.47 per share and revenue of $49.14 billion, which would represent changes of -44.48% and -13.65%, respectively, from the prior year.
It is also important to note the recent changes to analyst estimates for Dow Inc.Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Dow Inc. currently has a Zacks Rank of #3 (Hold).
Digging into valuation, Dow Inc. currently has a Forward P/E ratio of 14.54. For comparison, its industry has an average Forward P/E of 11.59, which means Dow Inc. is trading at a premium to the group.
We can also see that DOW currently has a PEG ratio of 2.91. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Chemical - Diversified stocks are, on average, holding a PEG ratio of 2.08 based on yesterday's closing prices.
The Chemical - Diversified industry is part of the Basic Materials sector. This industry currently has a Zacks Industry Rank of 166, which puts it in the bottom 35% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
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