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DuPont (DD) Up 23% in 3 Months: What's Driving the Stock?

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DuPont de Nemours, Inc.’s (DD - Free Report) shares have popped 22.6% over the past three months. The company has also outperformed its industry’s rise of 14.3% over the same time frame. The stock also topped the S&P 500’s 6.4% rise over the same period.

Let’s take a look into the factors that are driving this Zacks Rank #2 (Buy) stock’s price performance.

 

 

What’s Working in DD’s Favor?

Forecast-topping first-quarter results and upbeat outlook have contributed to the run-up in the company’s shares. DuPont’s adjusted earnings of 91 cents per share for the first quarter trounced the Zacks Consensus Estimate of 77 cents. Net sales also rose 8% year over year to $3,976 million, and also beat the Zacks Consensus Estimate of $3,811.5 million.

DuPont also raised its guidance for net sales and adjusted earnings per share for 2021. Net sales for the year are now forecast to be between $15.7 billion and $15.9 billion, compared with $15.4 billion and $15.6 billion expected earlier. The company also expects adjusted earnings per share for 2021 in the band of $3.60-$3.75, up from the prior view of $3.30-$3.45.

DuPont is benefiting from cost synergy savings and productivity improvement actions. Its structural cost actions are contributing to its bottom line.

The company is also gaining from sustained strength in semiconductors and smartphone technologies, continued recovery in automotive and industrial markets and strong demand for water filtration technologies.

Moreover, the company remains focused on driving growth though innovation and new product development. Its innovation-driven investment is focused on several high-growth areas. It remains committed to drive returns from its R&D investment.

The company also remains focused on driving cash flow and shareholder value. It looks to boost cash flow through working capital productivity and earnings growth. The company returned $660 million to shareholders through share repurchases and dividends during the first quarter. It expects to return roughly $640 million in dividends this year.

Earnings estimates for DuPont have also been going up over the past two months. The Zacks Consensus Estimate for the current year has increased around 7.3%. The consensus estimate for second-quarter 2021 has also been revised 15.9% upward over the same time frame. The favorable estimate revisions instill investor confidence in the stock.

 

 

Stocks to Consider

Other top-ranked stocks worth considering in the basic materials space include Nucor Corporation (NUE - Free Report) , Dow Inc. (DOW - Free Report) and Impala Platinum Holdings Limited (IMPUY - Free Report) .

Nucor has a projected earnings growth rate of 228.4% for the current year. The company’s shares have rallied around 156% in a year. It currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Dow has a projected earnings growth rate of 261.5% for the current year. The company’s shares have shot up around 95% in a year. It currently sports a Zacks Rank #1.

Impala Platinum has an expected earnings growth rate of 225.2% for the current fiscal. The company’s shares have surged around 172% in the past year. It currently carries a Zacks Rank #2.

5 Stocks Set to Double

Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.

Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.

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