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Dow Inc. (DOW) Stock Sinks As Market Gains: What You Should Know

Zacks Equity Research
·3-min read

In the latest trading session, Dow Inc. (DOW) closed at $56.81, marking a -1.08% move from the previous day. This move lagged the S&P 500's daily gain of 0.15%.

Heading into today, shares of the materials science had lost 9.77% over the past month, lagging the Basic Materials sector's loss of 3.98% and the S&P 500's loss of 0.58% in that time.

Wall Street will be looking for positivity from DOW as it approaches its next earnings report date. This is expected to be October 21, 2021. In that report, analysts expect DOW to post earnings of $2.55 per share. This would mark year-over-year growth of 410%. Our most recent consensus estimate is calling for quarterly revenue of $14.24 billion, up 46.58% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $8.47 per share and revenue of $53.19 billion. These totals would mark changes of +410.24% and +38.01%, respectively, from last year.

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Investors might also notice recent changes to analyst estimates for DOW. These revisions help to show the ever-changing nature of 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. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an 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. The Zacks Consensus EPS estimate has moved 1.35% higher within the past month. DOW is holding a Zacks Rank of #3 (Hold) right now.

In terms of valuation, DOW is currently trading at a Forward P/E ratio of 6.78. This represents a discount compared to its industry's average Forward P/E of 12.73.

Meanwhile, DOW's PEG ratio is currently 0.25. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Chemical - Diversified industry currently had an average PEG ratio of 1.02 as of yesterday's close.

The Chemical - Diversified industry is part of the Basic Materials sector. This group has a Zacks Industry Rank of 178, putting it in the bottom 30% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual 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.

To follow DOW in the coming trading sessions, be sure to utilize Zacks.com.


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