Taking a Fresh Look at The Dow Chemical Company (DOW)

The Dow Chemical Company (DOW) is an interesting player in the Basic Materials space, with a focus on Chemicals – Major Diversified. The stock has been active on the tape, currently trading at $64.53, down from yesterday’s close by -1.12%. Given the stock’s recent action, it seemed like a good time to take a closer look at the company’s recent data.

Fundamental Analysis

Does this stock stack up well when compared to its peers in the industry space? Let’s take a look. The Dow Chemical Company (DOW) currently trades with a market capitalization of $78.85 Billion. That value represents a market adjusting for revenues that have been growing by 23.61 % on a quarterly year/year basis as of the company’s last quarterly report.

The balance sheet health of any company plays a key role in its ability to meet its obligations and maintain the faith of its investment base. For DOW, the company currently has $5.99 Billion of cash on the books, which is offset by $999 Million current liabilities. You can get a sense of how sustainable that is by a levered free cash flow of $2.17 Billion over the past twelve months. Generally speaking, earnings are expected to fall in coming quarters. Analysts are forecasting earnings of $1.02 on a per share basis this quarter. Perhaps, that suggests something about why 53.65% of the outstanding share supply is held by institutional investors.

Technical Analysis

Sometimes, we can understand most about a stock by simply looking at how it has been trading. Looking at the stock’s movement on the chart, The Dow Chemical Company recorded a 52-week high of $65.42. It is now trading 0.89% off that level. The stock is trading $62.48 its 50-day moving average by -2.05%. The stock carved out a 52-week low down at $47.51.

In recent action, The Dow Chemical Company (DOW) has made a move of +3.58% over the past month, which has come on weak relative transaction volume. Over the trailing year, the stock is outperforming the S&P 500 by 5.98, and it’s gotten there by action that has been more volatile on a day-to-day basis than most other stocks on the exchange. In terms of the mechanics underlying that movement, traders will want to note that the stock is trading on a float of 1.14% with $1.22 Billion sitting short, betting on future declines. That suggests something of the likelihood of a short squeeze in shares of DOW.

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