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The Latest Wall Street Views on Dow Chemical

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Analyst recommendations

As of June 13, 2017, 20 brokerage firms were actively tracking Dow Chemical (DOW) stock. Among them, 80.0% have recommended a “buy” for the stock, 20.0% have recommended a “hold,” and none of them have recommended a “sell.”

Analysts’ consensus predicts a 12-month target price of $71.83 for Dow Chemical, implying a return potential of 10.1% over the closing price of $65.26 as of June 13, 2017.

Why most analysts are recommending a ‘buy’

DOW posted better-than-expected 1Q17 earnings along with the positive developments of receiving conditional approvals from Brazil, China, and the European Commission for the merger of DuPont (DD) and Dow Chemical. The business expansion in Saudi Arabia and the US Gulf Coast and the continued integration of the Dow Corning business are expected to further drive DOW’s future growth. As a result of all these positive developments, analysts are tending to recommend a “buy” for Dow Chemical.

Target prices by well known brokerage firms

  • RBC Capital Markets has recommended a target price of $76 for Dow Chemical, which implies a 12-month potential return of 16.5% over the closing price of $65.26 on June 13, 2017.
  • Barclays (BCS) has rated Dow “equal weight” with a target price of $65. DOW is already trading 0.40% above the recommended price as of June 13, 2017.
  • Deutsche Bank (DB) has rated Dow Chemical a “buy” with a target price of $70, which implies a 12-month potential return of 7.3% over the closing price of $65.26 on June 13, 2017.
  • Cowen and Company has issued a target price of $60 for Dow Chemical, which implies a 12-month potential return of -7.7% over the closing price of $65.26 on June 13, 2017.

You can indirectly hold Dow Chemical by investing in the First Trust Indxx Global Agriculture ETF (FTAG). FTAG invests 10.6% of its portfolio in Dow Chemical as of June 13, 2017.

In the next and final part of this series, let’s look at Dow Chemical’s latest valuations.

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