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DOW Closes Sale of Flexible Packaging Laminating Adhesives Business
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Dow Inc. (DOW - Free Report) has completed the previously announced sale of its flexible packaging laminating adhesives business, which is part of its Packaging & specialized Plastics unit, to Arkema, a specialized materials company, for $150 million.
The transaction, announced on May 2, 2024, includes five manufacturing facilities in Italy, the United States and Mexico. The business product line comprises solvent-based and solventless laminating adhesives as well as heat seal coatings.
The transaction proceeds will support Dow's capital allocation objectives, which include advancing growth plans and producing long-term shareholder value. The closure of this sale, alongside the acquisition of Circulus, a mechanical recycler, earlier this year, demonstrates Dow's commitment to aligning its portfolio with its growth strategy and circularity platforms.
The divestment not only advances DOW's core business but also sets it up for future development and innovation. The company keeps its water-based laminating adhesives, acrylic adhesives and adhesive solutions businesses, which are critical to its development and sustainability initiatives.
DOW’s shares lost 14.8% in a year against the industry’s 4.4% growth.
Image Source: Zacks Investment Research
Dow, in its third-quarter call, said that it will continue to operate with discipline as it capitalizes on areas of demand strength while leveraging its scale and advantaged cost positions on a global basis. Its strong financials will continue to support its growth investments on higher-value businesses and regions, where it has a competitive cost advantage and sees resilient demand. DOW expects these investments to deliver more than $3 billion in underlying earnings by 2030.
DOW currently carries a Zacks Rank #5 (Strong Sell).
Better-ranked stocks in the basic materials space include Carpenter Technology Corporation (CRS - Free Report) , DuPont de Nemours, Inc. (DD - Free Report) and CF Industries Inc. (CF - Free Report) .
CRS beat the Zacks Consensus Estimate in each of the last four quarters, with the average earnings surprise being 14.1%. The company's shares have soared 163.4% in the past year.
The consensus estimate for DD’s current-year earnings is pegged at $3.88 per share, indicating a year-over-year rise of 11.5%. DD, which currently carries a Zacks Rank #2 (Buy) , beat the consensus estimate in each of the last four quarters, with the average earnings surprise being 12.9%. The company's shares have rallied roughly 16.7% in the past year.
The Zacks Consensus Estimate for CF’s current-year earnings is pegged at $6.32 per share. CF, which currently sports a Zacks Rank of 1, beat the consensus estimate in two of the last four quarters and missed twice, the average earnings surprise being 10.3%. CF has gained around 23.2% in the past year.
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DOW Closes Sale of Flexible Packaging Laminating Adhesives Business
Dow Inc. (DOW - Free Report) has completed the previously announced sale of its flexible packaging laminating adhesives business, which is part of its Packaging & specialized Plastics unit, to Arkema, a specialized materials company, for $150 million.
The transaction, announced on May 2, 2024, includes five manufacturing facilities in Italy, the United States and Mexico. The business product line comprises solvent-based and solventless laminating adhesives as well as heat seal coatings.
The transaction proceeds will support Dow's capital allocation objectives, which include advancing growth plans and producing long-term shareholder value. The closure of this sale, alongside the acquisition of Circulus, a mechanical recycler, earlier this year, demonstrates Dow's commitment to aligning its portfolio with its growth strategy and circularity platforms.
The divestment not only advances DOW's core business but also sets it up for future development and innovation. The company keeps its water-based laminating adhesives, acrylic adhesives and adhesive solutions businesses, which are critical to its development and sustainability initiatives.
DOW’s shares lost 14.8% in a year against the industry’s 4.4% growth.
Image Source: Zacks Investment Research
Dow, in its third-quarter call, said that it will continue to operate with discipline as it capitalizes on areas of demand strength while leveraging its scale and advantaged cost positions on a global basis. Its strong financials will continue to support its growth investments on higher-value businesses and regions, where it has a competitive cost advantage and sees resilient demand. DOW expects these investments to deliver more than $3 billion in underlying earnings by 2030.
Dow Inc. Price and Consensus
Dow Inc. price-consensus-chart | Dow Inc. Quote
DOW’s Rank & Key Picks
DOW currently carries a Zacks Rank #5 (Strong Sell).
Better-ranked stocks in the basic materials space include Carpenter Technology Corporation (CRS - Free Report) , DuPont de Nemours, Inc. (DD - Free Report) and CF Industries Inc. (CF - Free Report) .
Carpenter Technology currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
CRS beat the Zacks Consensus Estimate in each of the last four quarters, with the average earnings surprise being 14.1%. The company's shares have soared 163.4% in the past year.
The consensus estimate for DD’s current-year earnings is pegged at $3.88 per share, indicating a year-over-year rise of 11.5%. DD, which currently carries a Zacks Rank #2 (Buy) , beat the consensus estimate in each of the last four quarters, with the average earnings surprise being 12.9%. The company's shares have rallied roughly 16.7% in the past year.
The Zacks Consensus Estimate for CF’s current-year earnings is pegged at $6.32 per share. CF, which currently sports a Zacks Rank of 1, beat the consensus estimate in two of the last four quarters and missed twice, the average earnings surprise being 10.3%. CF has gained around 23.2% in the past year.