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Bullish chart patterns are becoming difficult to find, but active traders seem to be turning to the materials sector for good reason.
(Bloomberg) -- Royal DSM NV is among suitors exploring potential bids for DuPont de Nemours Inc.’s nutrition and bioscience business, which could be valued at as much as $25 billion, people with knowledge of the matter said.The company has lined up advisers as it considers making an offer for the division, according to the people, who asked not to be identified because the information is private. DuPont has also been reaching out to other potential bidders including Ireland’s Kerry Group Plc and Swiss fragrances and flavorings maker Givaudan SA, one of the people said.DuPont has recently sent confidentiality agreements to prospective buyers, the people said. The specialty chemicals maker has been evaluating options for the nutrition business including a sale or spinoff, as well as a type of tax-free merger known as a Reverse Morris Trust, Bloomberg News reported last month. It aims to conclude the review by the end of the year, though the timing could slip, one of the people said.Shares of DSM fell as much as 3.3% in afternoon trading Monday, hitting the lowest intraday level in four weeks. They were down 1.3% at 4:12 p.m. in Amsterdam.Coveted BusinessNo final decisions have been made, and there’s no certainty the suitors will proceed with firm offers, the people said. Representatives for DuPont, DSM and Givaudan declined to comment. A representative for Kerry didn’t immediately respond to emails and phone calls seeking comment.DowDuPont Inc.’s breakup is handing DSM Chief Executive Officer Feike Sijbesma an opportunity to buy a business he’s long coveted. DuPont built its nutrition division with the 2011 acquisitions of enzyme maker Genencor International Inc. and Denmark’s Danisco AS, which DSM already had a stake in. DuPont was eventually forced to raise its bid to succeed in the Danisco takeover, which was one of the factors that left it vulnerable to activist pressure and led to its eventual merger with Dow Chemical Co.For Kerry, DuPont’s nutrition business offers the opportunity to enhance its existing food ingredients business and move into bacteria cultures used in dairy products. Kerry started out as a dairy business in southwestern Ireland before expanding into flavorings and chilled food brands.Givaudan spent about $1.6 billion last year to acquire Naturex, a French maker of organic plant-based flavorings. Shares of Givaudan have risen 16% over the past year, giving the Vernier-based company a market value of 25.5 billion euros.(Updates with DSM share movement in fourth paragraph.)\--With assistance from Aaron Kirchfeld, Ellen Proper, David Hellier and Dinesh Nair.To contact the reporters on this story: Andrew Noël in London at email@example.com;Myriam Balezou in London at firstname.lastname@example.org;Kiel Porter in Chicago at email@example.comTo contact the editors responsible for this story: Ben Scent at firstname.lastname@example.org, ;Anthony Palazzo at email@example.com, ;Liana Baker at firstname.lastname@example.org, Matthew MonksFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Benzinga has examined the prospects for many investor favorite stocks over the past week. Bullish calls included the iPhone maker, a Big 3 automaker and a restructured industrial company. Bearish calls ...
DowDuPont was a huge company that broke apart into three companies: Dow, DuPont, and Corteva. DuPont could get smaller still, according to Citigroup, and that’s good for shareholders.
Shares of DuPont de Nemours Inc (NYSE: DD ) have higher resilience to a soft macro environment, given the company’s better operating discipline and “commitment to exploit its freedom to maneuver,” according ...
WILMINGTON, Del., and SEOUL, South Korea, Sept. 10, 2019 /PRNewswire/ -- DuPont Electronics & Imaging (E&I) today announced it has signed an agreement to sell its Compound Semiconductor Solutions (CSS) business to SK Siltron, a leading silicon wafer supplier to the semiconductor market based in South Korea. The transaction is consistent with DuPont's strategy of active portfolio management and disciplined capital allocation to further align the company's portfolio with high return opportunities. "The DuPont CSS business has state-of-the-art technologies for SiC wafer production to serve the power electronics market, but it is not a strategic priority for the E&I business," said Jon Kemp, President, DuPont Electronics & Imaging.
(Bloomberg Opinion) -- The Saudi Arabian monarchy made a major change this week in the leadership of its national oil company, Saudi Aramco. Khalid Al-Falih, the former CEO and current oil minister, was removed as chairman and replaced by Yasir Al-Rumayyan, the head of Saudi Arabia’s sovereign wealth fund. With the kingdom readying plans for an Aramco IPO, what should we make of this shift, and is Al-Rumayyan – a confidante of Crown Prince Mohammed bin Salman with no experience in oil or energy – the best choice to fill the position?On the one hand, removing Al-Falih from the board of Saudi Arabian Oil Co. will help the company establish itself as distinct from the Saudi government team that creates oil policy at OPEC. This should insulate Aramco from some antitrust allegations. If or when Aramco does go public, the move could help protect the company from investigations by other governments concerning its connections to the international oil cartel. As Al-Falih himself wrote in a tweet in Arabic, the new leadership of the board is a step toward an IPO:But Al-Rumayyan isn’t a choice that should promote confidence in the direction of the company. For one, his background is in finance: After various jobs in Saudi banking, he was appointed to run the Public Investment Fund, or PIF, in 2015, and is said to consult very closely with Prince Mohammed. He has used a large portion of the PIF as a venture-capital fund – so much so that through the PIF, Saudi Arabia has become one of the single biggest investors in U.S. startups. Al-Rumayyan has also overseen the PIF’s position as a power broker in the kingdom, with the fund backing new ideas and even social causes such as a major investment that brought AMC Theaters to Saudi Arabia when cinemas were legalized. None of this points to any expertise in oil. Al-Falih was an oil company veteran with a successful track record in the business, so it made sense for him to lead the board. In fact, it’s typical for major international oil companies to be led by energy professionals. At Exxon Mobil Corp. and Chevron Corp., for example, the chairmen are also the CEOs. Royal Dutch Shell PLC’s chairman is Charles Holliday, who once ran the chemicals firm DuPont. BP PLC’s chairman is the former CEO of BG Group and Statoil, both energy companies.The monarchy could have replaced Al-Falih with the current CEO, Amin Nasser; one of several retired top Aramco executives still active in the company community; an outside industry veteran; or even Prince Mohammed's own half-brother, Abdul Aziz, who was a university professor and formerly a top bureaucrat in the oil ministry. Instead, it chose Al-Rumayyan, a yes-man for the monarchy.More importantly, the shake-up points to the impending transfer of Aramco to the PIF portfolio, as Prince Mohammed has wanted to do for years. Before he even ascended to his current role, Prince Mohammed argued that Aramco should be just another portfolio company. In 2016, he said Aramco “is a company that has a value – an investment. You must own it as an investment. It should not be owned as a primary commodity or a major source of income.” That’s not inspiring for Saudi Arabia, which still relies on Aramco for most of its revenue. Nor is it inspiring for potential investors who are looking for the supremely profitable company to continue on its prior positive trajectory.To be clear, the board of directors of a national company has limited authority in an absolute monarchy. There is actually a committee that sits above the board called the Supreme Aramco Council, which is chaired by the crown prince, who also lacks any experience in energy. Still, the board technically maintains oversight over the upper management of Aramco, as well as the massive dividend given to the treasury each quarter and the company’s IPO plans.If nothing else, this move is a sign to the company executives in Dhahran that they are no longer completely in charge of the business they and their predecessors turned into a success. But it is important to understand that this is also a sign to potential investors that this energy company – the richest and most powerful business in the world – is now being overseen by amateurs.(This article was corrected to remove a reference to Hess Corp. in the fourth paragraph. )To contact the author of this story: Ellen R. Wald at email@example.comTo contact the editor responsible for this story: Beth Williams at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Ellen R. Wald is president of Transversal Consulting and a nonresident senior fellow at the Atlantic Council's Global Energy Center.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
Third Point LLC has agreed to pay more than $600,000 to settle allegations the hedge fund failed to properly file for antitrust clearance when it bought DowDuPont stock two years ago, the U.S. Justice Department said on Wednesday. Third Point, which invests roughly $15 billion in securities around the world and is run by billionaire investor Daniel Loeb, will pay a civil fine of $609,810, the department said. Two years ago the hedge fund allegedly bought too much DowDuPont stock too quickly, failing to make the required Hart-Scott-Rodino filings or observe a required waiting period.
DuPont will stop using controversial PFAS chemicals in its operations by the end of the year, the Wilmington-based company announced Wednesday. PFAS — a group of chemicals used in the production of things like Teflon and firefighting foam — has been associated with serious health problems as the resilient chemicals don’t break down naturally in the environment or the human body. It will also offer royalty-free licenses for DuPont’s proprietary PFAS water-treatment technology and bring in external experts who will review its use and handling of “substances of concern.” DuPont’s announcement comes about two weeks before the House of Representatives’ Oversight and Reform Committee’s environmental subcommittee plans to hold a hearing on PFAS contamination, Chemical and Engineering News reported.
The chemicals, which have been used for decades in products like Teflon and other non-stick products as well as firefighting foam, have contaminated water systems. Companies including DuPont, Dow Chemical and 3M have faced numerous lawsuits from people exposed to the chemicals in their water supply. Dupont said it would stop buying or using all firefighting foams made with polyfluoroalkyl substances (PFAS), a group of chemicals that includes perfluorooctanoic acid (PFOA), by the end of 2021.
WILMINGTON, Del., Aug. 28, 2019 /PRNewswire/ -- As a responsible partner in addressing concerns about the health and environmental impacts of per- and polyfluoroalkyl substances (PFAS), DuPont today announced a set of comprehensive commitments related to its use of these substances. PFAS are a group of chemicals that includes perfluorooctanoic acid (PFOA), perfluorooctanesulfonic acid (PFOS), GenX, and other chemicals, and have been used by many manufacturers to produce a broad range of industrial and consumer products and firefighting foams as early as the 1940s. DuPont does not make PFOA, PFOS or GenX.
The short history of the new Dow (NYSE:DOW) stock has brought little more than declines. An initial spike after Dow again became a separate company has given away to four months of falling stock prices. Today, it sells near its lowest point since its reintroduction.Source: JHVEPhoto / Shutterstock.com The ongoing trade war with China explains much of the decline. However, the spinoff of the former DowDuPont into Dow, DuPont de Nemours (NYSE:DD) and Corteva (NYSE:CTVA) has left investors with a company structure few seem to understand. Until Dow can simplify the company and resume its previous flow of trade with China, DOW stock will likely continue its descent. DOW Stock Continues to DeclineA little more than a month ago, I turned bullish on DOW stock after having been a bear. While I saw possible headwinds related to the trade war, I figured the low price-to-earnings ratio and the generous dividend made a position in DOW worthwhile.InvestorPlace - Stock Market News, Stock Advice & Trading TipsThen, earnings happened. A revenue miss sent it on a downward journey. The declines continued as two analysts downgraded DOW stock to a sell, both cite weakening global demand as the reason. Today, it trades in the $43 per share range, near its 52-week low. * 10 Undervalued Stocks With Breakout Potential From a certain point of view, this does not change my previous rationale for recommending DOW stock. The forward P/E ratio now stands at 9.6. Moreover, thanks to the lower stock price, the $2.80 per share annual dividend currently yields almost 6.5%. Dow's Problems Go Beyond the Trade WarHowever, other factors have since persuaded me otherwise. As InvestorPlace columnist Bret Kenwell states, free cash flow did not cover the cost of the DOW stock dividend. Furthermore, with the company just having separated itself from DuPont, investors have no dividend history where they can turn.Moreover, investors have struggled with the business model backing up Dow stock since it became separate. Our own Josh Enomoto goes so far as to compare DOW stock to General Electric (NYSE:GE) and 3M (NYSE:MMM). He points out its consumer, industrial and packaging categories as evidence that Dow has become a hodgepodge of different companies without a focused purpose. Between that and the lower revenue tied to the U.S.-China trade war, the selling continues in DOW.In fairness, DOW stock is not the only equity in this industry which has suffered. Peers such as Westlake Chemical (NYSE:WLK) and LyondellBasell Industries (NYSE:LYB) also have fallen to 52-week lows. Furthermore, one has to wonder when the market will finally consider the trade war priced into DOW stock and its peers?For now, DOW continues to fall. Even with a low P/E and a high dividend yield, investors rarely succeed by fighting the herd. Moreover, when it does come time to buy, investors must ponder whether they would prefer DOW stock or one of its peers. For example, LyondellBasell stock sells for only 5.8 times forward earnings. At about 5.8%, it pays a slightly lower but still impressive dividend yield. Also, this dividend has risen for seven straight years, and yes, the company cash flows cover this payout. The Bottom Line on DOW StockDOW stock needs both a cohesive focus and for China trade to begin moving higher. Dow stock has fallen since the company missed revenue for its second quarter. Even a low multiple and a generous dividend yield have not stemmed the decline.To some degree, DOW faces the same issues with China trade as its peers. As a result, these peers also have seen their stocks fall to 52-week lows. However, many investors and analysts struggle to understand how the company works since the spinoff. Moreover, with the lack of a dividend history, investors cannot know whether the payout will remain stable under current market conditions. The fact that it does not generate sufficient cash flows to cover this payout merely casts more doubts.Until investors know DOW stock has priced in trade war concerns, investors should stay away. Also, when it comes time for buyers to return to this industry, the case for buying DOW could appear weak. With LYB stock offering a lower valuation and a more stable dividend, investors may not buy Dow stock at that time either.As of this writing, Will Healy did not hold a position in any of the aforementioned stocks. You can follow Will on Twitter at @HealyWriting. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Marijuana Stocks That Could See 100% Gains, If Not More * 11 Stocks Under $10 to Buy Now * 6 China Stocks to Buy on the Dip The post Dow Stock Is Cheap for Too Many Reasons appeared first on InvestorPlace.
Chemicals maker Dow (NYSE:DOW) is the smallest member of the Dow Jones Industrial Average (DJIA) by market value. The blue-chip index weights its members by price, not the traditional market cap weighting scheme, but even by price weighting, Dow stock is the second-smallest member of the Dow Jones Industrial Average.Source: JHVEPhoto / Shutterstock.com That's the good news because Dow stock has recently been repudiated in significant fashion with the U.S.-China trade spat serving as major drag on the shares. While Michigan-based Dow operates in a stodgy industry (chemicals) and probably should be seen as a value name rather than a growth stock, it's a cyclical stock, meaning it's likely not an appropriate holding for conservative investors in the current market environment.Recent price action confirms as much. Year-to-date, Dow stock is one of just seven members of the DJIA that are in the red and one of just four with 2019 losses of 10% or more. Simply put, in price, there is truth, and the truth for Dow stock right now is largely unappealing, particularly with the shares in the midst of a month-to-date slide of 15.17% (as of Aug. 20).InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 10 Marijuana Stocks to Ride High on the Farm Bill Dow is one of three companies spun off from the merged Dow/DuPont company. The others are DuPont de Nemours (NYSE:DD), and Corteva (NYSE:CTVA). Only Corteva is trading higher since the spin-offs.The primary drivers of Dow stock performance from an operating unit standpoint are the company's Performance Materials and Coatings, Industrial Intermediates and Infrastructure and Packaging and Specialty Plastics businesses. They Can't All Be WrongLast month, Dow CEO Jim Fitterling said trade tensions are weighing on consumer confidence, impacting purchases of larger ticket items that Dow makes ingredients for. As a result, the company lowered its 2019 capital expenditures plan to $2 billion from $2.5 billion."What tariffs have done in some businesses is cause a little bit of a pause, a little bit of reluctance…Chinese purchasers to maybe buy American goods," said Fitterling in a Bloomberg TV interview. "That shifts some of the demand around."Fitterling is optimistic a trade deal will get done, he just doesn't see that deal coming to fruition before the end of this year. Without the U.S. and China making nice on trade, it's hard to get involved with a stock like Dow.Additionally, analyst sentiment is sour on Dow stock. While analysts are not right or wrong 100% of the time, there's often similar actions from the sell side in a condensed period of time. Since late July, there have been five downgrades of Dow stock by four different analysts, moves that also included several lower price target revisions.Last week, Bank of America Merrill Lynch analyst Steve Byrne pared his rating on Dow stock to "underperform" from "neutral," his second downgrade of the name in less than a month, while trimming his price target to $41 from $55. Byrn cited "eroding fundamentals" in his downgrade of Dow stock.Thing is, the average price target on Dow stock is just over $56 while the shares closed around $43 on Tuesday, Aug. 20. Make of that what you will, but that could be a sign more bearish price target revisions are coming because analysts like to save face. Bottom Line on DOW StockFor patient, risk-tolerant investors, there are some silver linings with Dow stock. At just 12x forward earnings, the shares are by no means expensive and there is compensation for the risk in the form of a dividend yield north of 6%. That's more than triple what you get on the S&P 500.And there's one more silver lining: some insiders recently bought Dow stock, something they wouldn't be doing if they believed a recession is imminent. After all, insiders only buy their company's shares for one reason: because they think the stock is going up.Todd Shriber doesn't the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Marijuana Stocks to Ride High on the Farm Bill * 8 Biotech Stocks to Watch After the Q2 Earnings Season * 7 Unusual, Growth-Oriented REITs to Buy for Your Portfolio The post Dow Stock a Downer Until Tariff Talk Subsides appeared first on InvestorPlace.
The chemical industry heavyweight is gone, and DuPont and Dow are officially back -- but very different. Here's how to keep track of the new companies.