Dow Chemical Beats Expectations but Takes a Step Back Anyway
Dow Chemical (NYS: DOW) reported earnings on April 26. Here are the numbers you need to know.
The 10-second takeaway
For the quarter ended March 31 (Q1), Dow Chemical missed slightly on revenues and beat slightly on earnings per share.
Compared to the prior-year quarter, revenue was unchanged and GAAP earnings per share shrank significantly.
Margins dropped across the board.
Dow Chemical reported revenue of $14.72 billion. The 11 analysts polled by S&P Capital IQ expected revenue of $15.01 billion on the same basis. GAAP reported sales were 0.1% lower than the prior-year quarter's $14.73 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
Non-GAAP EPS came in at $0.61. The 16 earnings estimates compiled by S&P Capital IQ averaged $0.60 per share on the same basis. GAAP EPS of $0.35 for Q1 were 34% lower than the prior-year quarter's $0.53 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 16.5%, 130 basis points worse than the prior-year quarter. Operating margin was 8.2%, 130 basis points worse than the prior-year quarter. Net margin was 3.4%, 140 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $16.39 billion. On the bottom line, the average EPS estimate is $0.78.
Next year's average estimate for revenue is $61.78 billion. The average EPS estimate is $2.68.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 2,096 members out of 2,227 rating the stock outperform, and 131 members rating it underperform. Among 624 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 608 give Dow Chemical a green thumbs-up, and 16 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Dow Chemical is hold, with an average price target of $36.67.
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At the time this article was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.