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Here's Why You Should Add DuPont (DD) to Your Portfolio Now
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Shares of DuPont de Nemours, Inc. (DD - Free Report) have popped around 18% over the past three months. DuPont is benefiting from innovation-driven investment and its productivity actions. Its planned separation into three independent, publicly traded companies is also expected to drive significant growth opportunities.
We are positive on the company’s prospects and believe that the time is right for you to add the stock to portfolio as it looks promising and is poised to carry the momentum ahead.
Let’s take a look into the factors that make this Zacks Rank #1 (Strong Buy) stock an attractive choice for investors right now.
An Outperformer
Shares of DD have gained 21.3% over a year against the 2.9% rise of its industry. It has also outperformed the S&P 500’s roughly 19% rise over the same period.
Image Source: Zacks Investment Research
Earnings Estimates Northbound
Over the past two months, the Zacks Consensus Estimate for DuPont for 2024 has increased around 3.7%. The consensus estimate for second-quarter 2024 has also been revised 7.7% upward over the same time frame. The favorable estimate revisions instill investor confidence in the stock. The Zacks Consensus Estimate for earnings for 2024 for DuPont is currently pegged at $3.63, reflecting an expected year-over-year growth of around 4.3%.
Impressive Earnings Surprise History
DuPont has outpaced the Zacks Consensus Estimate in each of the trailing four quarters. In this time frame, it has delivered an earnings surprise of roughly 9%, on average.
Capital Allocation
The company remains focused on driving cash flow and shareholder value. It looks to boost cash flow through working capital productivity and earnings growth. DuPont, in September 2023, completed the $3.25 billion accelerated share repurchase (ASR) transaction launched in November 2022. It also launched a new $2 billion ASR in September 2023 and completed it during the first quarter of 2024, thereby completing the $5 billion buyback program approved in November 2022. DD’s board approved a new repurchase program in first-quarter 2024 authorizing it to repurchase up to $1 billion of common stock. The company, in April 2024, completed the $500 million ASR launched in February 2024. DuPont also expects to return roughly $630 million in dividends for full-year 2024.
Multiple Growth Drivers in Place
DuPont remains focused on driving growth though innovation and new product development. Its innovation-driven investment is focused on several high-growth areas. DD remains committed to drive returns from its R&D investment.
The company, in August 2023, completed the buyout of leading manufacturer of specialty medical devices and components, Spectrum Plastics Group from AEA Investors for $1.75 billion. The acquisition strengthens DuPont’s existing position in stable and fast-growing healthcare end markets. It is also in sync with its focus on high-growth, customer-driven innovation for the healthcare market.
Moreover, DuPont is benefiting from cost synergy savings and productivity improvement actions. Benefits of its structural cost actions are expected to be realized in 2024. DD also continues to implement strategic price increases in the wake of cost inflation. These actions are likely to support its results. DuPont is also executing additional restructuring actions and expects annualized cost savings of $150 million from these measures with around $100 million anticipated in 2024.
DuPont, earlier this month, unveiled a strategic plan to separate into three distinct, publicly traded companies aimed at unlocking value for shareholders and enhancing operational focus. The proposed separations of the Electronics and Water businesses will be executed in a tax-free manner for DuPont shareholders, resulting in New DuPont, Electronics and Water as independent entities. Each company will benefit from increased agility and focus within their respective industries while maintaining strong balance sheets and attractive financial profiles.
The separations are expected to be completed within 18-24 months, subject to customary conditions and regulatory approvals. These transactions will be tax-free for DD shareholders and will not require a shareholder vote. All three resulting companies are anticipated to have strong balance sheets and sufficient capitalization to pursue future growth opportunities.
Other top-ranked stocks in the basic materials space include Axalta Coating Systems Ltd. (AXTA - Free Report) , Carpenter Technology Corporation (CRS - Free Report) and ATI Inc. (ATI - Free Report) .
Carpenter Technology currently carries a Zacks Rank #1. CRS beat the Zacks Consensus Estimate in three of the last four quarters while matching it once, with the average earnings surprise being 15.1%. The company’s shares have soared roughly 150% in the past year. You can see the complete list of today’s Zacks #1 Rank stocks here.
Axalta Coating Systems, carrying a Zacks Rank #1, has a projected earnings growth rate of 26.8% for the current year. In the past 60 days, the consensus estimate for AXTA's current-year earnings has been revised upward by 5.9%. The company’s shares have gained roughly 16% in the past year.
ATI currently carries a Zacks Rank #2 (Buy). ATI beat the Zacks Consensus Estimate in each of the last four quarters, with the average earnings surprise being 8.3%. The company’s shares have rallied around 77% in the past year.
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Here's Why You Should Add DuPont (DD) to Your Portfolio Now
Shares of DuPont de Nemours, Inc. (DD - Free Report) have popped around 18% over the past three months. DuPont is benefiting from innovation-driven investment and its productivity actions. Its planned separation into three independent, publicly traded companies is also expected to drive significant growth opportunities.
We are positive on the company’s prospects and believe that the time is right for you to add the stock to portfolio as it looks promising and is poised to carry the momentum ahead.
Let’s take a look into the factors that make this Zacks Rank #1 (Strong Buy) stock an attractive choice for investors right now.
An Outperformer
Shares of DD have gained 21.3% over a year against the 2.9% rise of its industry. It has also outperformed the S&P 500’s roughly 19% rise over the same period.
Image Source: Zacks Investment Research
Earnings Estimates Northbound
Over the past two months, the Zacks Consensus Estimate for DuPont for 2024 has increased around 3.7%. The consensus estimate for second-quarter 2024 has also been revised 7.7% upward over the same time frame. The favorable estimate revisions instill investor confidence in the stock. The Zacks Consensus Estimate for earnings for 2024 for DuPont is currently pegged at $3.63, reflecting an expected year-over-year growth of around 4.3%.
Impressive Earnings Surprise History
DuPont has outpaced the Zacks Consensus Estimate in each of the trailing four quarters. In this time frame, it has delivered an earnings surprise of roughly 9%, on average.
Capital Allocation
The company remains focused on driving cash flow and shareholder value. It looks to boost cash flow through working capital productivity and earnings growth. DuPont, in September 2023, completed the $3.25 billion accelerated share repurchase (ASR) transaction launched in November 2022. It also launched a new $2 billion ASR in September 2023 and completed it during the first quarter of 2024, thereby completing the $5 billion buyback program approved in November 2022. DD’s board approved a new repurchase program in first-quarter 2024 authorizing it to repurchase up to $1 billion of common stock. The company, in April 2024, completed the $500 million ASR launched in February 2024. DuPont also expects to return roughly $630 million in dividends for full-year 2024.
Multiple Growth Drivers in Place
DuPont remains focused on driving growth though innovation and new product development. Its innovation-driven investment is focused on several high-growth areas. DD remains committed to drive returns from its R&D investment.
The company, in August 2023, completed the buyout of leading manufacturer of specialty medical devices and components, Spectrum Plastics Group from AEA Investors for $1.75 billion. The acquisition strengthens DuPont’s existing position in stable and fast-growing healthcare end markets. It is also in sync with its focus on high-growth, customer-driven innovation for the healthcare market.
Moreover, DuPont is benefiting from cost synergy savings and productivity improvement actions. Benefits of its structural cost actions are expected to be realized in 2024. DD also continues to implement strategic price increases in the wake of cost inflation. These actions are likely to support its results. DuPont is also executing additional restructuring actions and expects annualized cost savings of $150 million from these measures with around $100 million anticipated in 2024.
DuPont, earlier this month, unveiled a strategic plan to separate into three distinct, publicly traded companies aimed at unlocking value for shareholders and enhancing operational focus. The proposed separations of the Electronics and Water businesses will be executed in a tax-free manner for DuPont shareholders, resulting in New DuPont, Electronics and Water as independent entities. Each company will benefit from increased agility and focus within their respective industries while maintaining strong balance sheets and attractive financial profiles.
The separations are expected to be completed within 18-24 months, subject to customary conditions and regulatory approvals. These transactions will be tax-free for DD shareholders and will not require a shareholder vote. All three resulting companies are anticipated to have strong balance sheets and sufficient capitalization to pursue future growth opportunities.
DuPont de Nemours, Inc. Price and Consensus
DuPont de Nemours, Inc. price-consensus-chart | DuPont de Nemours, Inc. Quote
Other Stocks to Consider
Other top-ranked stocks in the basic materials space include Axalta Coating Systems Ltd. (AXTA - Free Report) , Carpenter Technology Corporation (CRS - Free Report) and ATI Inc. (ATI - Free Report) .
Carpenter Technology currently carries a Zacks Rank #1. CRS beat the Zacks Consensus Estimate in three of the last four quarters while matching it once, with the average earnings surprise being 15.1%. The company’s shares have soared roughly 150% in the past year. You can see the complete list of today’s Zacks #1 Rank stocks here.
Axalta Coating Systems, carrying a Zacks Rank #1, has a projected earnings growth rate of 26.8% for the current year. In the past 60 days, the consensus estimate for AXTA's current-year earnings has been revised upward by 5.9%. The company’s shares have gained roughly 16% in the past year.
ATI currently carries a Zacks Rank #2 (Buy). ATI beat the Zacks Consensus Estimate in each of the last four quarters, with the average earnings surprise being 8.3%. The company’s shares have rallied around 77% in the past year.