DowDuPont Unit Sets Up Microbiome Venture to Drive Growth

Zacks Equity Research Published on December 01, 2017

DowDuPont Inc.’s unit DuPont Nutrition & Health has established a Microbiome Venture to spearhead the creation of new microbiome science-based solutions. The move is expected to play a significant role in DuPont’s business growth strategy.

With the Microbiome Venture, the company will be able to develop new microbiome science-based solutions for health and wellness. The Microbiome Venture investment is in sync with DuPont’s existing product portfolio, especially in the areas of probiotics and prebiotics, including human milk oligosaccharides.

In order to accelerate product development the Microbiome Venture will engage in strategic partnerships with other microbiome science leaders in academia and industry. Its first major partnership with the APC Microbiome Institute in Cork, Ireland, will focus on maternal and infant microbiomes, which plays a critical role in infant development and long-term health. The goal is to develop solutions for establishing a healthy microbiome in early life.

DowDuPont has underperformed the industry it belongs to over the last three months. The company’s shares have moved up around 7.1% over this period compared with roughly 10.2% gain recorded by the industry.

DowDuPont, during third-quarter 2017 earnings call, said that demand outlook remains positive for most of its key end-markets. It will remain focused on executing its near-term priorities that include delivering earnings and cash flow growth, executing its $3-billion cost synergy initiatives and advancing activities to create three growth companies in Agriculture, Materials Science and Specialty Products.

DowDuPont also declared it will take actions to enable cost savings of $3 billion. These include workforce reductions, buildings and facilities consolidations and select asset shutdowns. DowDuPont recorded pre-tax charges of $180 million in third-quarter 2017 in connection with the actions that are approved so far. It expects to record total pre-tax charges of around $2 billion, with around $1 billion expected in fourth-quarter 2017.

Dow Chemical Company (The) Price and Consensus

Zacks Names "Single Best Pick to Double"

From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.

It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.

This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.