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DuPont Stock Up 64% in 3 Months: What's Behind the Rally?
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DuPont de Nemours, Inc.’s (DD - Free Report) shares have popped 64.2% over the past three months. The company has also outperformed its industry’s rise of 41.3% over the same time frame.
The company has a market cap of roughly $38.4 billion and average volume of shares traded in the last three months is around 6,161.4K.
Let’s take a look into the factors that are driving this Zacks Rank #3 (Hold) stock.
What’s Favoring the Stock?
DuPont is benefiting from cost synergy savings and productivity improvement actions. The company now sees roughly $180 million of savings in 2020 from its earlier announced incremental cost actions, up from its prior expectation of $90 million. The company’s cost and productivity initiatives are expected to drive margin expansion in 2020.
Moreover, the company remains focused on driving growth though innovation and new product development. New product launches are driving growth in automotive electrification and water solutions. The company’s innovation-driven investment is focused on several high-growth areas. It remains committed to drive returns from its R&D investment. The company plans to invest roughly $900 million in R&D in 2020.
The company is also witnessing strength across personal protection, water filtration, food and beverage, electronics and probiotics markets. The coronavirus pandemic has led to a surge in demand in markets such as food & beverage and protective garments. DuPont is boosting capacity of protective garments amid soaring demand. Notably, the company is ramping up the production of Tyvek, a material which is used to make protective garments that shield frontline medical personnel from contracting the virus.
DuPont is also taking actions to strengthen its liquidity and optimize working capital amid the coronavirus-induced crisis. During the first quarter, the company boosted its liquidity position with a $1 billion revolving credit facility. It ended the quarter with a strong cash position of $1,748 million. With these and $1.3 billion in available commercial paper, the company has roughly $4 billion of total available liquidity.
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. It is taking actions to deliver more than $500 million of working capital improvement in 2020. DuPont is also deferring certain capital expenditures to boost free cash flow. It also expects to return roughly $900 million in dividends and $230 million in share repurchases this year.
Harmony Gold has an expected earnings growth rate of 264.3% for the current fiscal year. The company’s shares have gained 98% in the past year. It presently carries a Zacks Rank #2.
AngloGold has a projected earnings growth rate of 109.9% for the current year. The company’s shares have surged around 66% in a year. It currently has a Zacks Rank #2.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2021.
Image: Bigstock
DuPont Stock Up 64% in 3 Months: What's Behind the Rally?
DuPont de Nemours, Inc.’s (DD - Free Report) shares have popped 64.2% over the past three months. The company has also outperformed its industry’s rise of 41.3% over the same time frame.
The company has a market cap of roughly $38.4 billion and average volume of shares traded in the last three months is around 6,161.4K.
Let’s take a look into the factors that are driving this Zacks Rank #3 (Hold) stock.
What’s Favoring the Stock?
DuPont is benefiting from cost synergy savings and productivity improvement actions. The company now sees roughly $180 million of savings in 2020 from its earlier announced incremental cost actions, up from its prior expectation of $90 million. The company’s cost and productivity initiatives are expected to drive margin expansion in 2020.
Moreover, the company remains focused on driving growth though innovation and new product development. New product launches are driving growth in automotive electrification and water solutions. The company’s innovation-driven investment is focused on several high-growth areas. It remains committed to drive returns from its R&D investment. The company plans to invest roughly $900 million in R&D in 2020.
The company is also witnessing strength across personal protection, water filtration, food and beverage, electronics and probiotics markets. The coronavirus pandemic has led to a surge in demand in markets such as food & beverage and protective garments. DuPont is boosting capacity of protective garments amid soaring demand. Notably, the company is ramping up the production of Tyvek, a material which is used to make protective garments that shield frontline medical personnel from contracting the virus.
DuPont is also taking actions to strengthen its liquidity and optimize working capital amid the coronavirus-induced crisis. During the first quarter, the company boosted its liquidity position with a $1 billion revolving credit facility. It ended the quarter with a strong cash position of $1,748 million. With these and $1.3 billion in available commercial paper, the company has roughly $4 billion of total available liquidity.
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. It is taking actions to deliver more than $500 million of working capital improvement in 2020. DuPont is also deferring certain capital expenditures to boost free cash flow. It also expects to return roughly $900 million in dividends and $230 million in share repurchases this year.
DuPont de Nemours, Inc. Price and Consensus
DuPont de Nemours, Inc. price-consensus-chart | DuPont de Nemours, Inc. Quote
Stocks to Consider
Better-ranked stocks worth considering in the basic materials space include Agnico Eagle Mines Limited (AEM - Free Report) , Harmony Gold Mining Company Limited (HMY - Free Report) and AngloGold Ashanti Limited (AU - Free Report) .
Agnico Eagle has a projected earnings growth rate of 53.6% for the current year. The company’s shares have gained roughly 24% in a year. It currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Harmony Gold has an expected earnings growth rate of 264.3% for the current fiscal year. The company’s shares have gained 98% in the past year. It presently carries a Zacks Rank #2.
AngloGold has a projected earnings growth rate of 109.9% for the current year. The company’s shares have surged around 66% in a year. It currently has a Zacks Rank #2.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2021.
Click here for the 6 trades >>