Goldman Sachs upgraded chemical company, The Dow Chemical Company(DOW) to a “Buy” on Tuesday.
The firm has upgraded DOW from “Neutral” to a “Buy,” and has increased the company’s price target from $32 to $36. This price target suggests a 19.4% increase over the stock’s current price of $29.
An analyst from the firm commented, “we are upgrading DOW to Buy after its shares (+6% YTD) have lagged ethylene peers WLK (+98%) and LYB (+66%) as well as the overall sector (+16%) and the S&P500 (+10%),” the analyst comments. “We believe the 2012 underperformance was due to deterioration in trends at DOW’s coatings, electronics, materials, and non-US ethylene businesses. It appears this weakness is now reflected in consensus 2012 EPS estimates, which YTD have fallen 34%. With the bad news now generally accepted we see potential for significant EPS growth in 2013-14 off of the lowered 2012 consensus estimate.”
Dow Chemical Company shares were up 21 cents, or 0.73% during premarket trading Tuesday. The stock is mostly flat YTD.
The Bottom Line
Shares of Dow Chemical (DOW) have a 4.45% dividend yield, based on last night’s closing stock price of $28.79. The stock has technical support in the $26 price area. If the shares can firm up, we see overhead resistance around the $32 price level.
The Dow Chemical Company(DOW) is not recommended at this time, holding a Dividend.com DARS™ Rating of 0.0 out of 5 stars.