We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
DuPont de Nemours (DD) Down 0.3% Since Last Earnings Report: Can It Rebound?
Read MoreHide Full Article
A month has gone by since the last earnings report for DuPont de Nemours (DD - Free Report) . Shares have lost about 0.3% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is DuPont de Nemours due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
DuPont's Q2 Earnings and Revenues Surpass Estimates
DuPont reported earnings from continuing operations of 55 cents per share for second-quarter 2023, down from 71 cents per share in the year-ago quarter.
Barring one-time items, earnings came in at 85 cents per share for the reported quarter, topping the Zacks Consensus Estimate of 83 cents.
DuPont raked in net sales of $3,094 million, down 7% from the year-ago quarter. It surpassed the Zacks Consensus Estimate of $3,002.6 million. The company saw a 4% decline in organic sales in the quarter, hurt by 6% lower volumes that more than offset 2% higher pricing.
Segment Highlights
The company’s Electronics & Industrial segment recorded net sales of $1,312 million in the reported quarter, down 14% on a year-over-year comparison basis. It was below our estimate of $1,330.5 million. Organic sales fell 12% due to a decrease in volumes.
Semiconductor Technologies experienced a 19% volume decline due to weaker end-market demand and channel inventory destocking, while Interconnect Solutions saw a 15% volume decrease due to reduced consumer electronics spending. Despite the volume declines, there was a 7% sequential sales improvement from the first quarter of 2023. The Industrial Solutions segment faced a 2% volume decline, with strong performance in broad-based industrial markets offset by reduced demand in consumer-related areas such as displays and advanced printing applications.
Net sales in the Water & Protection unit were $1,494 million, stable year over year. The figure was above our estimate of $1,417 million. Organic sales rose 1% on pricing gains. Safety Solutions experienced growth, up in mid-single digits, thanks to carryover pricing and increased volume in aerospace, automotive and healthcare sectors. However, Shelter Solutions faced a 12% decline in organic sales, primarily due to softness in construction markets and channel inventory destocking, partly offset by carryover pricing.
Financials
DuPont had cash and cash equivalents of $4,885 million at the end of the quarter, up around 239% year over year. Long-term debt was $7,775 million, down around 27% year over year.
The company also generated operating cash flow from continuing operations of $400 million during the quarter.
Guidance
The company now sees net sales for 2023 to be in the range of $12,450-$12,550 million. Adjusted earnings per share for 2023 are forecast to be $3.40-$3.50. For third-quarter 2023, the company sees net sales of roughly $3,150 million. Adjusted earnings per share for the quarter are projected at roughly 84 cents.
The Electronics & Industrial segment is expected to see a 10% organic decline in revenues compared to the previous year. However, the addition of Spectrum is set to boost reported revenues starting from Aug 1. Overall, full-year revenues are projected to decrease approximately 10% organically, primarily due to lower volumes and production adjustments.
For the Water & Protection unit, a mid-single-digit decline in revenues on an organic basis is expected compared to the previous year, as the benefit from carryover pricing ends. Despite this, Water Solutions is forecast to achieve mid-single-digit organic growth for the full year, though it may face some weakness in the second half due to softer demand in China. On the other hand, Safety Solutions is projected to experience steady demand throughout 2023, driven by growth in the aerospace, automotive and healthcare sectors. Meanwhile, the construction end markets are expected to remain weak throughout the year, with the impact of destocking reducing in the second half.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
The consensus estimate has shifted -7.91% due to these changes.
VGM Scores
Currently, DuPont de Nemours has a poor Growth Score of F, a grade with the same score on the momentum front. However, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, DuPont de Nemours has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
DuPont de Nemours (DD) Down 0.3% Since Last Earnings Report: Can It Rebound?
A month has gone by since the last earnings report for DuPont de Nemours (DD - Free Report) . Shares have lost about 0.3% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is DuPont de Nemours due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
DuPont's Q2 Earnings and Revenues Surpass Estimates
DuPont reported earnings from continuing operations of 55 cents per share for second-quarter 2023, down from 71 cents per share in the year-ago quarter.
Barring one-time items, earnings came in at 85 cents per share for the reported quarter, topping the Zacks Consensus Estimate of 83 cents.
DuPont raked in net sales of $3,094 million, down 7% from the year-ago quarter. It surpassed the Zacks Consensus Estimate of $3,002.6 million. The company saw a 4% decline in organic sales in the quarter, hurt by 6% lower volumes that more than offset 2% higher pricing.
Segment Highlights
The company’s Electronics & Industrial segment recorded net sales of $1,312 million in the reported quarter, down 14% on a year-over-year comparison basis. It was below our estimate of $1,330.5 million. Organic sales fell 12% due to a decrease in volumes.
Semiconductor Technologies experienced a 19% volume decline due to weaker end-market demand and channel inventory destocking, while Interconnect Solutions saw a 15% volume decrease due to reduced consumer electronics spending. Despite the volume declines, there was a 7% sequential sales improvement from the first quarter of 2023. The Industrial Solutions segment faced a 2% volume decline, with strong performance in broad-based industrial markets offset by reduced demand in consumer-related areas such as displays and advanced printing applications.
Net sales in the Water & Protection unit were $1,494 million, stable year over year. The figure was above our estimate of $1,417 million. Organic sales rose 1% on pricing gains. Safety Solutions experienced growth, up in mid-single digits, thanks to carryover pricing and increased volume in aerospace, automotive and healthcare sectors. However, Shelter Solutions faced a 12% decline in organic sales, primarily due to softness in construction markets and channel inventory destocking, partly offset by carryover pricing.
Financials
DuPont had cash and cash equivalents of $4,885 million at the end of the quarter, up around 239% year over year. Long-term debt was $7,775 million, down around 27% year over year.
The company also generated operating cash flow from continuing operations of $400 million during the quarter.
Guidance
The company now sees net sales for 2023 to be in the range of $12,450-$12,550 million. Adjusted earnings per share for 2023 are forecast to be $3.40-$3.50. For third-quarter 2023, the company sees net sales of roughly $3,150 million. Adjusted earnings per share for the quarter are projected at roughly 84 cents.
The Electronics & Industrial segment is expected to see a 10% organic decline in revenues compared to the previous year. However, the addition of Spectrum is set to boost reported revenues starting from Aug 1. Overall, full-year revenues are projected to decrease approximately 10% organically, primarily due to lower volumes and production adjustments.
For the Water & Protection unit, a mid-single-digit decline in revenues on an organic basis is expected compared to the previous year, as the benefit from carryover pricing ends. Despite this, Water Solutions is forecast to achieve mid-single-digit organic growth for the full year, though it may face some weakness in the second half due to softer demand in China. On the other hand, Safety Solutions is projected to experience steady demand throughout 2023, driven by growth in the aerospace, automotive and healthcare sectors. Meanwhile, the construction end markets are expected to remain weak throughout the year, with the impact of destocking reducing in the second half.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
The consensus estimate has shifted -7.91% due to these changes.
VGM Scores
Currently, DuPont de Nemours has a poor Growth Score of F, a grade with the same score on the momentum front. However, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, DuPont de Nemours has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.