DOW INC (DOW) Stock Fundamental Analysis
NYSE:DOW - New York Stock Exchange, Inc. - US2605571031 - Common Stock
Taking everything into account, DOW scores 3 out of 10 in our fundamental rating. DOW was compared to 85 industry peers in the Chemicals industry. DOW has a bad profitability rating. Also its financial health evaluation is rather negative. DOW has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
In the past year DOW was profitable.
DOW had a positive operating cash flow in the past year.
Of the past 5 years DOW 4 years were profitable.
Each year in the past 5 years DOW had a positive operating cash flow.
1.2 Ratios
DOW has a Return On Assets (1.77%) which is comparable to the rest of the industry.
DOW has a Return On Equity of 5.75%. This is comparable to the rest of the industry: DOW outperforms 51.81% of its industry peers.
DOW has a Return On Invested Capital of 2.93%. This is in the lower half of the industry: DOW underperforms 65.06% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for DOW is in line with the industry average of 6.57%.
The 3 year average ROIC (8.04%) for DOW is well above the current ROIC(2.93%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.77% | ||
| ROE | 5.75% | ||
| ROIC | 2.93% |
ROA(3y)6.16%
ROA(5y)3.64%
ROE(3y)19.89%
ROE(5y)11.88%
ROIC(3y)8.04%
ROIC(5y)6.66%
1.3 Margins
Looking at the Profit Margin, with a value of 2.44%, DOW is in line with its industry, outperforming 44.58% of the companies in the same industry.
In the last couple of years the Profit Margin of DOW has declined.
DOW has a Operating Margin of 4.33%. This is in the lower half of the industry: DOW underperforms 67.47% of its industry peers.
In the last couple of years the Operating Margin of DOW has declined.
DOW has a Gross Margin of 10.76%. This is amonst the worse of the industry: DOW underperforms 81.93% of its industry peers.
DOW's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4.33% | ||
| PM (TTM) | 2.44% | ||
| GM | 10.76% |
OM growth 3Y-11%
OM growth 5Y-15.69%
PM growth 3Y-25.68%
PM growth 5Y-32.66%
GM growth 3Y-6.84%
GM growth 5Y-8.65%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), DOW is destroying value.
The number of shares outstanding for DOW has been reduced compared to 1 year ago.
DOW has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, DOW has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 1.91 indicates that DOW is not a great score, but indicates only limited risk for bankruptcy at the moment.
The Altman-Z score of DOW (1.91) is comparable to the rest of the industry.
DOW has a debt to FCF ratio of 20.13. This is a negative value and a sign of low solvency as DOW would need 20.13 years to pay back of all of its debts.
DOW has a Debt to FCF ratio (20.13) which is comparable to the rest of the industry.
DOW has a Debt/Equity ratio of 0.89. This is a neutral value indicating DOW is somewhat dependend on debt financing.
The Debt to Equity ratio of DOW (0.89) is worse than 66.27% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.89 | ||
| Debt/FCF | 20.13 | ||
| Altman-Z | 1.91 |
ROIC/WACC0.36
WACC8.19%
2.3 Liquidity
A Current Ratio of 1.66 indicates that DOW should not have too much problems paying its short term obligations.
DOW's Current ratio of 1.66 is on the low side compared to the rest of the industry. DOW is outperformed by 62.65% of its industry peers.
DOW has a Quick Ratio of 1.04. This is a normal value and indicates that DOW is financially healthy and should not expect problems in meeting its short term obligations.
With a Quick ratio value of 1.04, DOW is not doing good in the industry: 66.27% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.66 | ||
| Quick Ratio | 1.04 |
3. Growth
3.1 Past
The earnings per share for DOW have decreased by -5.73% in the last year.
Measured over the past years, DOW shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -33.37% on average per year.
Looking at the last year, DOW shows a decrease in Revenue. The Revenue has decreased by -5.84% in the last year.
DOW shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -2.09% yearly.
EPS 1Y (TTM)-5.73%
EPS 3Y10.95%
EPS 5Y-33.37%
EPS Q2Q%-2.08%
Revenue 1Y (TTM)-5.84%
Revenue growth 3Y5%
Revenue growth 5Y-2.09%
Sales Q2Q%1.39%
3.2 Future
The Earnings Per Share is expected to grow by 22.19% on average over the next years. This is a very strong growth
Based on estimates for the next years, DOW will show a small growth in Revenue. The Revenue will grow by 2.51% on average per year.
EPS Next Y-7.78%
EPS Next 2Y15.77%
EPS Next 3Y20.15%
EPS Next 5Y22.19%
Revenue Next Year-2.97%
Revenue Next 2Y0.19%
Revenue Next 3Y1.32%
Revenue Next 5Y2.51%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 19.27, which indicates a rather expensive current valuation of DOW.
DOW's Price/Earnings is on the same level as the industry average.
The average S&P500 Price/Earnings ratio is at 28.29. DOW is valued slightly cheaper when compared to this.
The Price/Forward Earnings ratio is 13.74, which indicates a correct valuation of DOW.
Compared to the rest of the industry, the Price/Forward Earnings ratio of DOW indicates a somewhat cheap valuation: DOW is cheaper than 66.27% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 24.44. DOW is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.27 | ||
| Fwd PE | 13.74 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of DOW indicates a somewhat cheap valuation: DOW is cheaper than 69.88% of the companies listed in the same industry.
DOW's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 35.09 | ||
| EV/EBITDA | 9.14 |
4.3 Compensation for Growth
A more expensive valuation may be justified as DOW's earnings are expected to grow with 20.15% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y15.77%
EPS Next 3Y20.15%
5. Dividend
5.1 Amount
DOW has a Yearly Dividend Yield of 6.85%, which is a nice return.
Compared to an average industry Dividend Yield of 3.26, DOW pays a better dividend. On top of this DOW pays more dividend than 92.77% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.28, DOW pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.85% |
5.2 History
DOW has been paying a dividend for at least 10 years, so it has a reliable track record.
DOW has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years5
5.3 Sustainability
186.79% of the earnings are spent on dividend by DOW. This is not a sustainable payout ratio.
DP186.79%
EPS Next 2Y15.77%
EPS Next 3Y20.15%
DOW INC
NYSE:DOW (1/22/2025, 11:49:08 AM)
41.245
-0.34 (-0.81%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryChemicals
Earnings (Last)
Earnings (Next)
Inst Owners70.66%
Inst Owner Change-0.39%
Ins Owners0.13%
Ins Owner Change1.08%
Market Cap28.88B
Analysts67.41
Price Target52.66 (27.68%)
Short Float %2.16%
Short Ratio1.89
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.85% |
Yearly Dividend2.8
Dividend Growth(5Y)N/A
DP186.79%
Div Incr Years0
Div Non Decr Years5
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-1.99%
Min EPS beat(2)-5.89%
Max EPS beat(2)1.91%
EPS beat(4)3
Avg EPS beat(4)6.04%
Min EPS beat(4)-5.89%
Max EPS beat(4)22.54%
EPS beat(8)6
Avg EPS beat(8)9.21%
EPS beat(12)10
Avg EPS beat(12)8.31%
EPS beat(16)14
Avg EPS beat(16)9.42%
Revenue beat(2)1
Avg Revenue beat(2)-0.32%
Min Revenue beat(2)-1.83%
Max Revenue beat(2)1.19%
Revenue beat(4)2
Avg Revenue beat(4)0%
Min Revenue beat(4)-1.83%
Max Revenue beat(4)1.43%
Revenue beat(8)5
Avg Revenue beat(8)0.5%
Revenue beat(12)7
Avg Revenue beat(12)1.15%
Revenue beat(16)11
Avg Revenue beat(16)2.1%
PT rev (1m)-7.97%
PT rev (3m)-9.67%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-57.21%
EPS NY rev (1m)0%
EPS NY rev (3m)-21.07%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-5.88%
Revenue NY rev (1m)-0.09%
Revenue NY rev (3m)-0.3%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.27 | ||
| Fwd PE | 13.74 | ||
| P/S | 0.67 | ||
| P/FCF | 35.09 | ||
| P/OCF | 7.69 | ||
| P/B | 1.58 | ||
| P/tB | 3.71 | ||
| EV/EBITDA | 9.14 |
EPS(TTM)2.14
EY5.19%
EPS(NY)3
Fwd EY7.28%
FCF(TTM)1.18
FCFY2.85%
OCF(TTM)5.37
OCFY13.01%
SpS61.68
BVpS26.16
TBVpS11.12
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.77% | ||
| ROE | 5.75% | ||
| ROCE | 3.85% | ||
| ROIC | 2.93% | ||
| ROICexc | 3.11% | ||
| ROICexgc | 4.04% | ||
| OM | 4.33% | ||
| PM (TTM) | 2.44% | ||
| GM | 10.76% | ||
| FCFM | 1.91% |
ROA(3y)6.16%
ROA(5y)3.64%
ROE(3y)19.89%
ROE(5y)11.88%
ROIC(3y)8.04%
ROIC(5y)6.66%
ROICexc(3y)8.62%
ROICexc(5y)7.15%
ROICexgc(3y)11.41%
ROICexgc(5y)9.54%
ROCE(3y)10.6%
ROCE(5y)8.79%
ROICexcg growth 3Y-7.66%
ROICexcg growth 5Y-10.48%
ROICexc growth 3Y-6.32%
ROICexc growth 5Y-11.02%
OM growth 3Y-11%
OM growth 5Y-15.69%
PM growth 3Y-25.68%
PM growth 5Y-32.66%
GM growth 3Y-6.84%
GM growth 5Y-8.65%
F-Score4
Asset Turnover0.73
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.89 | ||
| Debt/FCF | 20.13 | ||
| Debt/EBITDA | 3.48 | ||
| Cap/Depr | 104.75% | ||
| Cap/Sales | 6.79% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 80.41% | ||
| Profit Quality | 78.23% | ||
| Current Ratio | 1.66 | ||
| Quick Ratio | 1.04 | ||
| Altman-Z | 1.91 |
F-Score4
WACC8.19%
ROIC/WACC0.36
Cap/Depr(3y)78.03%
Cap/Depr(5y)68.98%
Cap/Sales(3y)4.17%
Cap/Sales(5y)4.07%
Profit Quality(3y)230.22%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-5.73%
EPS 3Y10.95%
EPS 5Y-33.37%
EPS Q2Q%-2.08%
EPS Next Y-7.78%
EPS Next 2Y15.77%
EPS Next 3Y20.15%
EPS Next 5Y22.19%
Revenue 1Y (TTM)-5.84%
Revenue growth 3Y5%
Revenue growth 5Y-2.09%
Sales Q2Q%1.39%
Revenue Next Year-2.97%
Revenue Next 2Y0.19%
Revenue Next 3Y1.32%
Revenue Next 5Y2.51%
EBIT growth 1Y-20.11%
EBIT growth 3Y-6.55%
EBIT growth 5Y-17.45%
EBIT Next Year96.69%
EBIT Next 3Y35.3%
EBIT Next 5Y24.17%
FCF growth 1Y-85.27%
FCF growth 3Y-17.08%
FCF growth 5Y5.8%
OCF growth 1Y-52.89%
OCF growth 3Y-5.85%
OCF growth 5Y4.08%