Are Wall Street Analysts Bullish on Dow Stock?

Based in Midland, Michigan, Dow Inc. (DOW) is a materials science leader with a market capitalization of $30.8 billion. The company provides a broad portfolio of advanced and sustainable products, featuring high-value functional polymers, cost-efficient global feedstocks, and an extensive network of manufacturing facilities worldwide.

Shares of the chemical company have underperformed the broader market considerably over the past year. DOW has dropped 14.5% over this time frame, while the broader S&P 500 Index ($SPX) is up 30.4%. In 2024, the stock is down 19.7%, compared to SPX’s 23.1% return on a YTD basis.

Narrowing the focus, DOW has also lagged behind the Materials Select Sector SPDR Fund’s (XLB) 14.3% returns over the past year and 6.7% gains on a YTD basis.

Dow has lagged the broader market over the past year due to declining prices, weak demand in key sectors, and challenges in Europe, where geopolitical tensions have hindered consumer spending and industrial activity.

On Nov. 4, Dow stock fell over 2% after S&P Dow Jones Indices announced that The Sherwin-Williams Company (SHW) would replace it in the Dow Jones Industrial Average, effective before trading on November 8.

For the current fiscal year, ending in December, analysts expect DOW’s EPS to decline 6.3% year over year to $2.10. The company’s earnings surprise history is mixed. It beat the consensus estimates in three of the last four quarters while missing on one other occasion.

Dow stock has a consensus “Moderate Buy” rating overall. Out of 19 analysts covering the stock, four advise a "Strong Buy," and 15 suggest a "Hold."

This configuration has been fairly consistent over the past months.

On Nov. 8, Piper Sandler Companies (PIPR) analyst Charles Neivert cut Dow's price target to $60 from $62, maintaining an “Overweight” rating. The firm anticipates weaker Q4 earnings, impacted by ongoing market challenges and seasonal demand softness, following already depressed Q3 results.

The mean price target of $55.78 suggests a 26.7% premium to DOW from current levels. The Street-high target of $62 represents an impressive upside potential of 40.8%.

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On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.

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