In the latest close session, Dow Inc. (DOW) was down 1.78% at $33.63. The stock trailed the S&P 500, which registered a daily gain of 1.75%. Elsewhere, the Dow saw an upswing of 1.86%, while the tech-heavy Nasdaq appreciated by 2.54%.
Coming into today, shares of the materials science had lost 11.84% in the past month. In that same time, the Basic Materials sector lost 8.25%, while the S&P 500 lost 1.63%.
Investors will be eagerly watching for the performance of Dow Inc. in its upcoming earnings disclosure. On that day, Dow Inc. is projected to report earnings of $0.85 per share, which would represent year-over-year growth of 302.38%. At the same time, our most recent consensus estimate is projecting a revenue of $12.16 billion, reflecting a 20.36% rise from the equivalent quarter last year.
For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $2.54 per share and a revenue of $43.64 billion, representing changes of +370.21% and +9.19%, respectively, from the prior year.
It is also important to note the recent changes to analyst estimates for Dow Inc. Recent revisions tend to reflect the latest near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the business performance and profit potential.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 7.01% higher. Dow Inc. is currently a Zacks Rank #1 (Strong Buy).
Looking at valuation, Dow Inc. is presently trading at a Forward P/E ratio of 13.5. Its industry sports an average Forward P/E of 16.14, so one might conclude that Dow Inc. is trading at a discount comparatively.
Meanwhile, DOW's PEG ratio is currently 0.24. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Chemical - Diversified industry had an average PEG ratio of 1.2 as trading concluded yesterday.
The Chemical - Diversified industry is part of the Basic Materials sector. Currently, this industry holds a Zacks Industry Rank of 90, positioning it in the top 37% of all 250+ industries.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
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This article originally published on Zacks Investment Research (zacks.com).