Valued at a market cap of $27.2 billion, Dow Inc. (DOW) is a leading global materials science company specializing in innovative and sustainable chemical, plastic, and industrial solutions. Headquartered in Midland, Michigan, Dow develops advanced materials and performance products that serve a wide range of industries, including packaging, infrastructure, automotive, and consumer goods.
Shares of Dow have underperformed the broader market considerably over the past year. DOW stock has declined 28.5% over this time frame, while the broader S&P 500 Index ($SPX) is up 20.7%. In 2025, the stock is down 3.7%, compared to SPX’s 3.2% return on a YTD basis.
Narrowing the focus, DOW has also lagged behind the Materials Select Sector SPDR Fund’s (XLB) 7.4% returns over the past year and 6.1% gains on a YTD basis.
On Jan. 30, Dow reported its Q4 earnings, causing a 6.1% drop in its stock price. The company posted net sales of $10.4 billion, down 2% year over year, despite a 1% volume increase across most regions. Operating EBIT declined by $105 million to $454 million, primarily due to lower prices, partially offset by higher operating rates and cost reductions. Dow reported a GAAP net loss of $35 million, or $0.08 per share, reflecting restructuring and efficiency-related costs.
For the current fiscal year, ending in December, analysts expect DOW’s EPS to grow 32.2% year over year to $2.26. The company’s earnings surprise history is mixed. It beat the consensus estimates in two of the last four quarters while missing on two other occasions.
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 Jan. 31, RBC Capital lowered DOW's price target to $38 from $41 while maintaining a “Sector Perform” rating, citing near-term volume and margin weakness, along with $200 million in expected Q1 headwinds, despite a slight Q4 EBITDA beat.
The mean price target of $46.31 suggests a 19.9% premium to the current levels. The Street-high target of $57 represents an impressive upside potential of 47.6%.
