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DuPont (DD) Approves $1.5 Billion Share Repurchase Program

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DuPont de Nemours, Inc. DD received an approval from its board for a share buyback program worth $1.5 billion that expires on Jun 30, 2022. Per this program, the shares may be repurchased periodically in open market or privately negotiated transactions.

Management will determine the actual timing, manner, number and value of shares repurchased. This will depend on multiple factors like market price of the company’s common stock, general market and economic conditions, applicable requirements and other business considerations.

At the end of 2020, DuPont had remaining authorization under its 2019 Share Buyback Program to repurchase its common stock worth around $1 billion. In its last earnings call, the company had noted that it has resumed the share repurchase under 2019 Share Buyback Program. It expects to complete the remaining $1-billion repurchase before the expiration of the program on Jun 1, 2021.

Post completion of the 2019 Share Buyback Program, the company expects to repurchase shares under 2021 Share Buyback Program, subject to management’s discretion and the above-mentioned factors.

Notably, the company generated strong operating cash flow of $4.1 billion and free cash flow of $2.9 billion in 2020. It also paid out dividend worth $882 million to shareholders in 2020.DuPont also ended 2020 with cash and cash equivalents of $2,544 million, up around 65% year over year.

Shares of DuPont have gained 106.3% in the past year compared with 73.5% rise of the industry.

DuPont, in its last earnings call, stated that it expects adjusted earnings per share for full-year 2021 in the range of $3.30-$3.45. The projection suggests a 68% increase at the mid-point from 2020 adjusted earnings of $2.01 per share.

Net sales for the year are forecast between $15.4 billion and $15.6 billion, indicating an increase of 8% at the mid-point from 2020 net sales of $14.3 billion.

For first-quarter of 2021, DuPont expects net sales in the band of $3.75-$3.85 billion. The projection suggests 4% rise at the mid-point from $3.7 billion in the prior-year quarter. Adjusted earnings are predicted in the range of 75-77 cents per share, indicating 58% increase at the mid-point from 48 cents per share in the prior-year quarter.

DuPont de Nemours, Inc. Price and Consensus

DuPont de Nemours, Inc. Price and Consensus
DuPont de Nemours, Inc. Price and Consensus

DuPont de Nemours, Inc. price-consensus-chart | DuPont de Nemours, Inc. Quote

Zacks Rank & Key Picks

DuPont currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the basic materials space are Fortescue Metals Group Limited FSUGY, BHP Group BHP and Impala Platinum Holdings Limited IMPUY.

Fortescue has a projected earnings growth rate of 95.4% for the current fiscal. The company’s shares have surged around 186.7% in a year. It currently flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

BHP has an expected earnings growth rate of 70.7% for the current fiscal. The company’s shares have gained 113.3% in the past year. It currently sports a Zacks Rank #1.

Impala has an expected earnings growth rate of 186.9% for the current fiscal. The company’s shares have rallied around 149.8% in the past year. It currently sports a Zacks Rank #1.

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