Dow (DOW)
Materials · $22.6B market cap · SEC CIK 0001751788
ahead of 3% of the S&P 500 · #25 of 26 in Materials
Next reports on Jan 28, 2027, after the close, with analysts expecting $0.56 in earnings per share.
52-week range $20.93 to $42.74. 26% below its 52-week high and 50% above its low.
The case for DOW
- Pays a 5.4% dividend while you wait.
- Trades at 1.23× book value, close to what the balance sheet says it owns.
- Moves less than the market (beta 0.40).
- Price/sales of 0.5× is lower than 96% of Materials companies.
The case against
- Losing money over the last year: net margin −2.1%, return on equity −6%.
- Burned $1.4B of free cash in FY2025.
- Long-term debt of $17.8B would take 17 years of operating cash flow to repay.
- Pays a dividend while losing money over the last twelve months.
- Free-cash-flow yield of −6.4% is lower than 96% of Materials companies.
- Growth is weak (28/100): revenue +4.2%, +0.7% a year over five years.
What the score is made of
Each factor is half a curve over reported figures and half a rank among the other Materials companies (momentum is judged against fixed thresholds only), and the five are blended by weight. The score is where that blend places it in the S&P 500. It describes the last filing and the current price. It is not a forecast.
| Valuewhat you pay for the earnings and cash, against the growth you get | 19 |
|---|---|
| Growthhow fast revenue and earnings are moving, this year and over five | 28 |
| Profitabilityhow much of the revenue becomes profit, and how much of that is cash | 14 |
| Momentumhow the price has behaved lately | 61 |
| Stabilityhow violently it moves, what it owes and what it pays you | 24 |
- It is losing money, so it has no P/E; that counts against value rather than being skipped.
- Its profits follow commodity prices, so last year's change in earnings per share is not counted as growth.
- Each factor except momentum is half fixed thresholds, half rank among the 26 Materials companies.
The financials
Revenue growth
Is the business growing? Slowly
| Last 12 months | +4.2% |
|---|---|
| Over 5 years | +0.7% a year |
| FY2025 revenue | $40.0B (−7%) |
Free cash flow
Is it generating real cash? No, it is burning cash
| FY2025 free cash flow | −$1.4B |
|---|---|
| Of revenue | −4% |
| Of profit | n/a |
Profit margins
Is profitability improving? No, slipping
| Gross margin | 11% |
|---|---|
| Operating margin | 1% |
| Net margin, FY24 → FY25 → now | 2.8% → −6.1% → −2.1% |
Debt vs. cash
Is the balance sheet healthy? Stretched
| Cash | $3.8B |
|---|---|
| Long-term debt | $17.8B |
| Net debt | $14.0B |
| Years to repay | 17.3 yrs |
Valuation
Is the stock price reasonable? Hard to say: no earnings to price
| P/E | n/a (a loss) |
|---|---|
| Fair P/E for its growth | 19× |
| P/FCF | no free cash flow |
| Forward P/E | 17.7× |
| EV / EBITDA | 74.7× |
| Price / sales | 0.5× |
It has no earnings to price. Its free cash flow is negative, which counts against it.
The financials, five years deep
Pulled from Dow's XBRL filings on SEC EDGAR. Italic rows are worked out from the others.
| FY2025 | FY2024 | FY2023 | FY2022 | FY2021 | |
|---|---|---|---|---|---|
| Revenue growth | |||||
| Revenue | $40.0B | $43.0B | $44.6B | $56.9B | $55.0B |
| Change on the year | −7% | −4% | −22% | +4% | — |
| Free cash flow | |||||
| Free cash flow | −$1.4B | −$26.0M | $2.8B | $5.7B | $5.5B |
| Of revenue | −4% | 0% | 6% | 10% | 10% |
| Profit margins | |||||
| Net margin | −6.1% | 2.8% | 1.5% | 8.2% | 11.7% |
| Debt vs. cash | |||||
| Cash | $3.8B | $2.2B | $3.0B | $3.9B | $3.0B |
| Long-term debt | $17.8B | $15.7B | $14.9B | $15.1B | $14.5B |
| Net cash (debt) | −$14.0B | −$13.5B | −$11.9B | −$11.2B | −$11.5B |
What Dow says it does
THE COMPANY Dow Inc. was incorporated on August 30, 2018, under Delaware law, to serve as a holding company for The Dow Chemical Company and its consolidated subsidiaries ("TDCC" and together with Dow Inc., "Dow" or the "Company"). Dow Inc. operates all of its businesses through TDCC, a wholly owned subsidiary, which was incorporated in 1947 under Delaware law and is the successor to a Michigan corporation, of the same name, organized in 1897. The Company's principal executive offices are located at 2211 H.H. Dow Way, Midland, Michigan 48674. Available Information The Company's Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, are available free of charge at www.dow.com/investors , as soon as reasonably practicable after the reports are electronically filed or furnished…