DuPont Crushed Earnings Estimates. The Stock Is Dropping.

2 months ago 23
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Updated Aug. 3, 2021 12:59 p.m. ET / Original Aug. 3, 2021 12:58 p.m. ET

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Materials elephantine DuPont reported beardown second-quarter net and raised guidance. The banal dropped, but that's par for the course.

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Materials elephantine DuPont reported beardown second-quarter earnings. What’s more, the institution gave beardown net guidance for the 3rd quarter. Management tis upbeat astir the future. The banal is dropping anyhow successful midday trading Tuesday.

DuPont (ticker: DD) reported $1.06 successful adjusted net per stock connected $4.1 cardinal successful sales. Wall Street was looking for EPS of 94 cents connected $4 cardinal successful sales.

What’s more, EPS guidance for the 3rd 4th and afloat twelvemonth is simply a midpoint of $1.12. Wall Street was projecting 99 cents. And full-year EPS guidance is astatine a midpoint of $4.27. That’s a large summation from prior EPS guidance of astir $3.68. There isn’t a batch to kick about.

“DuPont had a coagulated 4th and we expect momentum to continue,” wrote Citigroup expert P.J. Juvekar successful a Tuesday report. He rates shares astatine Buy and has a $96 terms target.

Still shares are down 1.6% successful midday trading. The S&P 500 and Dow Jones Industrial Average are up 0.4% and 0.5%, respectively.

Stocks don’t ever spell up aft coagulated earnings. This is the sixth consecutive net bushed for DuPont. Shares have dropped 3 times and roseate 3 times aft reporting these quarterly results.

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Despite the reaction, the institution feels bully astir its business.

“Continued affirmative momentum successful astir each of our cardinal end-markets, including semiconductor, smartphones, automotive, and residential construction, enabled america to present beardown 2nd 4th results up of expectations,” said CEO Ed Breen successful the company’s quality release. “Our teams’ aggravated absorption connected moving intimately with customers and suppliers during an situation of planetary proviso concatenation and logistics challenges and escalating earthy worldly costs was captious to our 2nd 4th results.”

Ebitda, abbreviated for net earlier interest, taxes, depreciation, and amortization, nett margins expanded astir 5 percent points twelvemonth implicit twelvemonth and were level with the archetypal 4th of 2021. Sales grew astatine double-digit-percentage rates successful each 3 of the company’s segments: Electronics, cars, and water.

Investors aren’t truly catching on the the coagulated performance. DuPont banal is up lone astir 3% twelvemonth to date, trailing down the 17% and 14% respective returns of the S&P 500 and Dow Jones Industrial Average.

And the banal trades astatine astir 17 times estimated 2022 earnings, a discount to the market’s 20 times PE ratio.

Write to Al Root astatine

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