Dow (DOW) certainly fits the dividend template that I’ve explained in my Special Report: “10 Dividend Stocks that are beating the risky rockets” on my subscription site JubakAM.com.
The stock yields 5.26% after a 0.20% gain today December 9. That compares to a yield of just 2.8% in July 2017 and 3.1% in December 2016. The stock also shows a 1.06% price to sales ratio on today. I think we’re looking at a cheap stock.
Tomorrow I’l be adding it to my Dividend Portfolio.
Which isn’t surprising. Dow sells its chemical products into just about every part of the U.S. and global economy with particular exposure to industries like automobiles, packaging, and plastics. As the economy has slowed during the coronavirus pandemic, Dow’s sales have slowed.
But the third quarter looks like a pivot point, The company did report a loss of $25 million versus the year-ago profit of $333 million. That dropped adjusted earnings to 50 cents a share from 91 cents a share in the third quarter of 2019. But earnings stilll beat analyst exceptions at did sales.
In the packaging and specialty plastics business sales slid 9.8% year over year to $4.57billion, but analysts had expected a bigger drop to $4.41 billion. Industrial intermediates and infrastructure revenues dropped 9.1% to $3.06 billion but analysts had expected just $2.73 billion in revenue. In the performance materials and coatings sales slumped 11% to $2 billion, slightly above analyst estimates of $1.93 billion.
For the global crucial industry a a whole, demand has climbed for the last five months with the Global Chemical Production Regional Index went up 1.5% in October from September after a 1.6% gain in that month. A big plus has been the pickup in economic activity in China, a top global consumer of chemicals.
In the last quarter Dow also reported a pick up n some prices–polyethylene prices rose 12% from the second quarter, for example. Which is an important indicator that so far the recovery in the sector hasn’t brought a lot of new capacity out of the woodwork.