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DuPont Beats Earnings Estimates in 1Q17, Stock Rises

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DuPont’s 1Q17 earnings

DuPont (DD) announced its 1Q17 earnings on April 25, 2017. DuPont reported operating earnings per share (or EPS) of $1.64 in 1Q17, an increase of 30% from the $1.26 reported in the previous year. DuPont beat Wall Street analysts’ consensus estimate of $1.38 per share.

What pushed DuPont’s earnings upwards?

DuPont’s operating EPS jumped on a solid performance across all of its segments driven by increased volumes, price benefits, and cost savings. DuPont displayed good control over its COGS (cost of goods sold). DuPont’s COGS increased from $4.2 billion in 1Q16 to $4.4 billion in 1Q17. As a percentage of sales, DuPont’s 1Q17 COGS represented 56.4% of its revenue and its 1Q16 COGS represented 57.3%, a decline of 0.9 percentage points on a year-over-year basis.

Stock price reaction

DuPont’s stock price reacted positively to the earnings beat, closing at $82.21. On the same day, peers The Dow Chemical Company (DOW), LyondellBasell (LYB), and Eastman Chemical (EMN) gained 3.2%, 0.56%, and 0.5%, respectively.

DuPont’s guidance for the first half of 2017

After its strong 1Q17 performance, DuPont now expects its operating EPS for the first half of 2017 to be $2.90, an increase of 16% over the previous year. Investors can hold DuPont indirectly by investing in the First Trust Indxx Global Agriculture ETF (FTAG), which had a 10.2% exposure to DuPont as of April 25, 2017. Continue to the remaining parts of the series for further discussion on DuPont’s earnings, performance by segment, and analysts’ opinions on the stock.

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