Bill Pugliano
Commodity chemicals producer Dow Inc (NYSE:DOW) is expected to report a decline in third quarter profit and revenue when it announces results on Tuesday, October 24th, before market open.
The consensus EPS estimate is $0.45 (-59.5% Y/Y) and the consensus revenue estimate is $10.38B (-26.4% Y/Y).
Steve Byrne, analyst at Bank of America in a recent analysis said, while the brokerage sees several signs that petrochemical fundamentals are near the bottom, “the challenge will be striking a balance between buying trough earnings and weathering poor 3Q financial results.”
Bank of America however, upgraded Dow (DOW), and industry peers Huntsman (HUN) and LyondellBasell Industries (LYB), and cut ratings on Albemarle (ALB), Sherwin-Williams (SHW) and Westlake (WLK).
Investors will keep a close eye on remarks on Middle East and China, after the chemical maker earlier this year flagged that demand in the world’s second largest economy continues to be uneven.
In its second quarter results, Dow (DOW) said it expects to execute on near-term cost savings actions as it manages through a macro environment that is expected to remain challenging in the second half of the year.
On a year-to-date basis, Dow (DOW) shares have fallen 3%, compared to a nearly 12% gains in the S&P 500 index.
