Friday, 6 June 2014
Tuesday, 28 January 2014
Dow Chemicals Follows in DuPont’s Footsteps, Spins Off Low-margin Assets
Dow Chemicals (DOW), the 115 year old American multinational chemical corporation giant, is planning to spin-off of its $4 billion chorine derivatives business. As a result of this divestiture, the company will essentially be getting out of a business it has been involved in for over one hundred years. The move is a part of an ongoing effort to prove to investors that the company has weaned itself away from concentrating on low-margin businesses towards focusing on high-margin, less cyclical businesses.
As Investors tend to look kindly upon companies that choose to sell or spin-off their underperforming assets, it comes as no surprise that Dow stock registered a stock price jump of 2.25% after the company announced divesting resources from its chlorine chain, which generates 9% of the company’s total revenues. The move is a sure signal that the company is increasingly focused on benefiting from patented products, which provide them with an opportunity to earn higher margins than their commodity chemicals businesses. DOW has already shed non-cores businesses which were generating $10 billion in revenue since 2009.
Monday, 13 January 2014
Dupont Sell Side Expectations
Currently, 26 sell-side analysts are covering DuPont and their estimates for its share price lie within a range of $70 and $48. In its latest earnings release the company reiterated its EPS guidance for 4Q13 to 60 cents and FY13 earnings of $3.85. Analysts in general believe that DuPont’s future EPS and growth targets are heavily dependent upon a halt in the fall in titanium dioxide prices and stability in the farm economy.
Read More : Dupont ( DD ) Sell Side Expectations
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