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DuPont (DD) Gears Up for Q1 Earnings: What's in the Offing?

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DuPont de Nemours, Inc. (DD - Free Report) is scheduled to come up with first-quarter 2021 results, before the opening bell on May 4. Benefits of cost-savings and productivity actions are expected to get reflected on its results. However, its results are likely to reflect the impacts of weak demand across certain markets and lower nylon prices.

The company surpassed the Zacks Consensus Estimate in each of the trailing four quarters. In this timeframe, it delivered an earnings surprise of around 9.4%, on average. It posted an earnings surprise of 3.3% in the last reported quarter.

DuPont’s shares have rallied 72.9% over a year compared with 71.9% rise recorded by the industry it belongs to.

 


 

 

Let’s see how things are shaping up for this announcement.

Zacks Model

Our proven model predicts an earnings beat for DuPont this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earning beat.

Earnings ESP: Earnings ESP for DuPont is +2.27%. The Zacks Consensus Estimate for earnings for the first quarter is currently pegged at 77 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: DuPont currently carries a Zacks Rank #2.

What do the Estimates Say?

For the first quarter, DuPont sees net sales in the band of $3.75-$3.85 billion. Adjusted earnings is predicted in the range of 75-77 cents per share.

The Zacks Consensus Estimate for revenues for the first quarter is currently pinned at $3,812 million, suggesting an expected year-over-year decline of 27%.

Some Factors to Watch For

DuPont is likely to have benefited from its cost and productivity actions in the quarter to be reported. Its structural cost actions are likely to have contributed to its bottom line in the quarter.

The company is also expected to have benefited, in the first quarter, from higher demand for products used in personal protection as well as strong demand in semiconductor technologies and smartphones. Higher demand in water solutions and strength in residential construction markets are likely to have supported its first-quarter performance.

However, soft demand across certain markets amid the coronavirus pandemic is likely to have impacted the company’s top line in the first quarter. DuPont is seeing weakness across certain markets such as aerospace, commercial construction, industrial and oil & gas. Sustained weakness in these markets is likely to have affected its volumes.

The company is also likely to have faced headwind from weaker nylon prices in the to-be-reported quarter. Nylon prices remain under pressure partly due to the supply-demand imbalance. Pricing pressure is expected to have affected the company’s Mobility & Materials division in the first quarter due to nylon headwinds.

 

DuPont de Nemours, Inc. Price and EPS Surprise

 

DuPont de Nemours, Inc. Price and EPS Surprise

DuPont de Nemours, Inc. price-eps-surprise | DuPont de Nemours, Inc. Quote

 

Stocks That Warrant a Look

Here are some companies in the basic materials space you may want to consider as our model shows they too have the right combination of elements to post an earnings beat this quarter:

Westlake Chemical Corporation (WLK - Free Report) , scheduled to release earnings on May 4, has an Earnings ESP of +0.64% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

CF Industries Holdings, Inc. (CF - Free Report) , scheduled to release earnings on May 5, has an Earnings ESP of +4.53% and carries a Zacks Rank #3.

Nutrien Ltd. (NTR - Free Report) scheduled to release earnings on May 3, has an Earnings ESP of +53.84% and carries a Zacks Rank #3.

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