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Dow (DOW) Acquires Circulus to Boost Circular Economy Efforts

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Dow Inc. (DOW - Free Report) announced an agreement to acquire Circulus, a prominent recycler of plastic waste into post-consumer resin (PCR). This transaction encompasses two facilities located in Ardmore, OK, and Arab, AL, which collectively have a capacity of 50,000 metric tons per year. The acquisition is expected to close in third-quarter 2024, pending customary regulatory approval.

This acquisition will enable Dow to integrate its industry-leading materials science technology with Circulus' film recycling expertise, helping to accelerate progress toward its 2030 ‘Transform the Waste’ goal. It will broaden Dow's industry participation, allowing the company to create more value for customers by directly producing high-performing circular products that are in demand by brands and consumers.

Dow Inc. Price and Consensus


Dow Inc. Price and Consensus

Dow Inc. price-consensus-chart | Dow Inc. Quote


Dow's expertise in materials science and high-performance resins, combined with Circulus' mechanical film recycling capabilities, will enhance Dow's offerings in collation shrink packaging, stretch film, liners and select food packaging. This will broaden its range of applications across industrial, consumer and transportation markets.

The Circulus team is enthusiastic about collaborating with Dow to advance a circular economy. It utilizes cutting-edge technology to improve the recycling of plastic packaging waste. With over 65 years of combined experience in the recycling and plastics industries, the leadership team produces high-quality, sustainably produced resins suitable for upcycled applications.

This transaction aligns with Dow's efforts to convert plastic waste and alternative feedstocks into 3 million metric tons of circular and renewable solutions annually by 2030. To achieve this, Dow is establishing industrial ecosystems for waste collection, reuse and recycling, thus expanding its portfolio to meet the increasing demand.

Dow’s shares have gained 5.5% in the past year against the industry's 3.3% decline in the same period.

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Zacks Rank & Key Picks

Dow currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the Basic Materials space are Carpenter Technology Corporation (CRS - Free Report) , ATI Inc. (ATI - Free Report) ,and Ecolab Inc. (ECL - Free Report) . While Carpenter Technology sports a Zacks Rank #1 (Strong Buy) at present, ATI and Ecolab carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for CRS’s current-year earnings is pegged at $4.31, indicating a year-over-year rise of 278%. CRS’ earnings beat the Zacks Consensus Estimate in three of the last four quarters while matching it once, the average earnings surprise being 15.1%. The company’s shares have soared 88.6% in the past year.

ATI’s earnings beat the Zacks Consensus Estimate in each of the last four quarters, the average earnings surprise being 8.34%, on average. The stock has rallied 35% in the past year.

The Zacks Consensus Estimate for Ecolab's current-year earnings is pegged at $6.59, indicating a rise of 26.5% from the year-ago levels. ECL beat the consensus estimate in each of the last four quarters, the average earnings surprise being 1.3. The stock has rallied nearly 35.6% in the past year.

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