Earnings Calendar (21Jul25) - What is Dow saying?

KYHBKO
07-20

Earnings Calendar (21Jul25)

I am interested in a few of the earnings like SAP, Tesla, Coca-Cola, GM, IBM, Dow Chemical and Intel.

Recent performance of Dow Inc

Let us look at Dow Inc, one of the leading chemical players.

The stock price fell 43.5% from a year ago. Technical Analysis is showing a “Strong Sell” rating. The Analysts’ sentiment remains ‘Neutral”. With a price target of $34.18, there is an implication of a 20.82% upside for its price. Should we take a risk with Dow?

Recent performance of Dow

  • Dow has yet to reach the previous revenue peak of $56.9B in 2022 or the best operating profit of $7.887B in 2021 (14.3% operating margin %).

  • Earnings per share (EPS) fell from the peak of $8.38 (2021) to the recent $1.57 (2024).

  • The P/E ratio of 68.4 renders a “high” valuation of the business.

  • Despite the challenges, Dow has maintained the dividends per share at $2.80 since 2020. It has not grown for 5 years. This is of concern for the company.

Other Key Metrics (from Grok)

  • Gross Profit and Margin: Gross profit declined, with the gross margin dropping. The 6-year median gross margin is approximately 17-18%, reflecting profitability pressure.

  • Competitive Advantage: The declining gross margin and ROIC highlight cost challenges, but Dow’s leadership in innovative materials (e.g., CIRCULARITY solutions) positions it for potential recovery in sustainable markets.

Overall Assessment

Over the period from 2019 to 2024, Dow Inc. has faced challenges, with declining revenue and EPS, driven by economic slowdowns and commodity price volatility. Operating profits dropped with falling margins, reflecting profitability pressures. Dow’s (weakening) competitive advantages include its global leadership in materials science, diversified portfolio, and focus on sustainability (e.g., recycled plastics), positioning it for potential growth in green markets. However, declining margins and earnings indicate a need for cost management and innovation to navigate cyclical challenges as of July 2025.

For Dow’s coming earnings, the forecast EPS and revenue are 0.161 and 10.24B, respectively.

Given the outlook and recent performance, I prefer to explore other chemical players this season.

@TigerStars

$S&P 500(.SPX)$

$SPDR S&P 500 ETF Trust(SPY)$

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Comments

  • MamieBenson
    07-21
    MamieBenson
    Insightful analysis, very informative! [Great]
    • KYHBKO: 
      thanks for your kind words.
  • AugustineMac-
    07-21
    AugustineMac-
    With those numbers, Dow seems risky.
    • KYHBKO: 
      yes. there is increasing risk.
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