Dow DOW
Dow Inc. is a diversified chemical company that produces and sells materials such as plastics, chemical intermediates, and high-performance solutions for sectors like packaging, construction, and electronics. Dow shows strong revenue growth (19.7%) and reasonable valuation (forward P/E 15.98), but its financial health is fragile: net debt/EBITDA of 3.84, gross margin of only 9.79%, and a free cash flow conversion of 6% that questions dividend sustainability (payout 700%).
Detailed metrics
Market and fundamental data as of the analysis date.
Full AI report
Generated automatically from the metrics, the macro context and the company's news.
Dow Inc. is a diversified chemical company that produces and sells materials such as plastics, chemical intermediates, and high-performance solutions for sectors like packaging, construction, and electronics. Dow shows strong revenue growth (19.7%) and reasonable valuation (forward P/E 15.98), but its financial health is fragile: net debt/EBITDA of 3.84, gross margin of only 9.79%, and a free cash flow conversion of 6% that questions dividend sustainability (payout 700%).
Score by category
| Category | Score |
|---|---|
| Financial health | 4.5 |
| Quality / Moat | 2.5 |
| Valuation | 4.7 |
| Growth | 8.2 |
| Dividend | 3.9 |
| Momentum | 8.2 |
| Risk & Context | 8.2 |
OVERALL SCORE: 5.2/10
Context and risks
Dow is a diversified chemical company with exposure to commodities and energy. The oil price surge raises its raw material and energy costs, compressing margins in an already low operating margin environment (11.59%). Additionally, rising rates to 5.17% increase refinancing costs for its debt (net debt/EBITDA 3.84).
News considered in the analysis
- Dow Inc. (DOW) Rises As Market Takes a Dip: Key Facts — Artículo de Zacks sin información nueva; describe el movimiento diario de la acción sin datos materiales.
- DOW Stock’s Payout Ratio Swings From 402% to -47% in a Year. Here’s What Investors Need to Know. — La volatilidad del payout refleja la debilidad del flujo de caja libre (conversión a caja libre del 6%), lo que pone en duda la sostenibilidad del dividendo a corto plazo.
- How Dow’s AI-Driven Efficiency Push and SupraCare Expansion At Dow (DOW) Has Changed Its Investment Story — Iniciativas de eficiencia operativa vía IA y expansión de SupraCare podrían mejorar márgenes, pero aún no se reflejan en los resultados (margen operativo 11.59%).
- Dow (DOW) Following Univar Expansion And A Fair Value Gap — La expansión con Univar podría ampliar la red de distribución y generar sinergias, aunque el impacto en beneficios aún no es cuantificable.
- Dow (DOW) Stock May Be 35% Undervalued As Cash Flow Recovers — La recuperación del flujo de caja es clave; la conversión a caja libre actual es solo del 6%, pero el crecimiento de ingresos del 19.7% sugiere potencial de mejora.
Verdict: Hold; wait for the free cash flow recovery to materialize before considering entry, given high leverage and margin pressure.
Main risk: High leverage (net debt/EBITDA 3.84) combined with weak margins (gross margin 9.79%) and 6% free cash flow conversion makes Dow vulnerable to a high-rate and high-energy-cost environment, putting the dividend at risk.
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