Morningstar | DowDuPont Reports High Level 1Q Results; We Maintain Our $45 FVE, Long-Term Outlook Intact. See Updated Analyst Note from 18 Apr 2019
On April 18, DowDuPont reported preliminary results. In the agriculture business, the company expect first-quarter EBITDA to be down 25% versus the first quarter of 2018 as flooding and cold weather delayed the start of the planting season. However, DowDuPont expects to make up the profits in the remainder of the year as management guided to first half EBITDA down 3%-5% and left full-year guidance unchanged. In the specialty products division, DowDuPont guided to EBITDA down 3%, which is in line with previous guidance.Today's announcement has little impact on our outlook, we maintain our $45 per share fair value estimate. Our narrow-moat rating is also unchanged. At current prices, we view DowDuPont as undervalued with the stock trading in 4-star territory.
For agriculture inputs companies, such as DowDuPont, weather can cause sales and profits to fluctuate widely from quarter to quarter as farmers will typically wait to purchase crop inputs, such as seeds, until just before planting. However, on a full-year basis, there is typically less volatility.
After spinning off the commodity chemicals business in June, DowDuPont currently holds the agriculture and specialty products businesses. The company remains on track to separate into two companies by the end of the second quarter. In June, DowDuPont will spin off the agriculture business, which will be known as Corteva. After the Corteva spin-off is complete, DowDuPont, which will only hold the specialty chemicals business, will rename itself DuPont.
DowDuPont is a holding company comprised of The Dow Chemical Company and E. I. du Pont de Nemours and Company with a focus on forming independent, publicly traded companies in the agriculture and specialty products sectors. The company's worldwide operations are managed through global businesses and include the following reportable segments: Agriculture; Electronics and Imaging; Nutrition and Biosciences; Transportation and Advanced Polymers; and Safety and Construction.
Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors.
Morningstar provides data on approximately 530,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 18 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries and had approximately $185 billion in assets under advisement and management as of June 30, 2016.
We have operations in 27 countries.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.