Back to top

Image: Bigstock

DowDuPont Agriculture Unit Declares Multi-Brand Seed Strategy

Read MoreHide Full Article

DowDuPont Inc.’s agriculture division, Corteva Agriscience, announced a new, focused multi-channel, multi-brand seed strategy for the United States. The move will help to increase access to the company's genetics, technology and traits across various agriculture distribution channels including agency, direct, retail, distribution and licensing.

Corteva Agriscience will implement this strategy through five regional corn and soybean seed brands in the United States, including Dairyland Seed, Hoegemeyer, NuTech, Seed Consultants and Terral. These brands will have expanded portfolio to better serve customers. Meanwhile, Brodbeck, Curry, Doebler's, Pfister and Prairie Brand will be combined with the five regional seed brands.

The company's global flagship seed brand, Pioneer, will continue with an industry leading, unique product portfolio and agency route-to-market approach. Mycogen and Terral brands will be serving the U.S. retail channel. The company will continue to sell cotton seed through its Phytogen brand and alfalfa through Alforex while maintaining the AgVenture independent network of regional seed companies.

The DowDuPont merger, which was closed last year, led to more than a dozen seed brands in the United States which sell Corteva Agriscience corn and soybean seed, genetics or traits.

DowDuPont has underperformed the industry it belongs to over the past three months. The company’s shares have lost around 5.5% over this period, compared with roughly 2.9% decline recorded by the industry.

 


 

The company recorded a profit (on a reported basis) of $1.1 billion or 47 cents per share for first-quarter 2018, compared with $888 million or 72 cents per share logged in the comparable quarter a year ago. Adjusted earnings came in at $1.12 per share for the quarter, which topped the Zacks Consensus Estimate of $1.08.

DowDuPont raked in net sales of $21,510 million for the reported quarter, up 5% from the comparable quarter a year ago. It also surpassed the Zacks Consensus Estimate of $21,320 million.

The company noted that it has realized cost synergy savings of more than $300 million in the first quarter and is on track to deliver a 75% run rate against its $3.3-billion cost synergy target by the end of third-quarter 2018. It also returned around $2 billion to shareholders in the first quarter through dividends and share repurchases.

DowDuPont expects net sales in the second quarter to increase more than 10% and operating EBITDA to rise more than 20% on a year-over-year basis.

DowDuPont remains committed to achieve the cost synergy target, execute its growth projects and deliver new products from its innovation pipeline. The company also expects the Materials Science business spin-off to complete by the end of first-quarter 2019 followed by the separation of Agriculture and Specialty Products businesses by Jun 1, 2019.

Zacks Rank & Stocks to Consider

DowDuPont is a Zacks Rank #3 (Hold) stock.

Some better-ranked companies in the basic materials space worth considering are FMC Corporation (FMC - Free Report) , Huntsman Corporation (HUN - Free Report) and Celanese Corporation (CE - Free Report) . All three stocks sport a Zacks Rank #1 (Strong Buy).  You can see the complete list of today’s Zacks #1 Rank stocks here.

FMC Corp has an expected long-term earnings growth rate of 13.6%.  Its shares have gained around 24.5% over a year.

Huntsman has an expected long-term earnings growth rate of 8.3%.  Its shares have moved up around 28.1% over a year.

Celanese has an expected long-term earnings growth rate of 8.9%.  Its shares have gained around 32.5% over a year.

Will You Make a Fortune on the Shift to Electric Cars?

Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.

With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.

It's not the one you think.

See This Ticker Free >>


Zacks' 7 Best Strong Buy Stocks (New Research Report)


Valued at $99, click below to receive our just-released report
predicting the 7 stocks that will soar highest in the coming month.


Click Here, It's Really Free

Published in