DuPont Gears Up for Q3 Earnings: What's in the Cards for the Stock?
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DuPont de Nemours, Inc. DD is scheduled to come up with third-quarter 2024 results, before the opening bell on Nov. 5.
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The company surpassed the Zacks Consensus Estimate in each of the trailing four quarters. In this timeframe, it delivered an earnings surprise of roughly 11.9%, on average. DD posted an earnings surprise of roughly 14.1% in the last reported quarter.
DuPont is expected to have benefited from its innovation-driven investment and productivity actions in the third quarter. Its results are likely to reflect the impacts of demand weakness in specific businesses.
DD’s shares are up 24.4% over a year compared with the Zacks Chemicals Diversified industry’s 8.4% rise.
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Let’s see how things are shaping up for this announcement.
What Our Model Unveils for DD Stock
Our proven model predicts an earnings beat for DuPont this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earning beat.
Earnings ESP: Earnings ESP for DD is +1.00%. The Zacks Consensus Estimate for the third quarter is currently pegged at $1.03. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: DD currently carries a Zacks Rank #2.
What do DD’s Revenue Estimates Say?
The Zacks Consensus Estimate for revenues for the third quarter for DuPont is currently pinned at $3,199.6 million, suggesting an expected year-over-year rise of 4.6%.
The consensus estimate for the company’s Electronics & Industrial segment is pinned at $1,553.2 million, indicating a 13.5% year-over-year rise. The same for the Water & Protection unit is pegged at $1,389.5 million, suggesting a 1.7% year-over-year decline.
Factors to Watch For DD Stock
DuPont is likely to have benefited from its cost and productivity measures and actions to drive growth through innovation in the quarter to be reported. Its innovation-driven investment is focused on several high-growth areas. DD remains committed to driving returns from its R&D investment.
Savings from restructuring actions are expected to have aided the company’s performance. DuPont is executing additional restructuring actions and expects annualized cost savings of $150 million from these measures with nearly $115 million anticipated in 2024. DD is also expected to have gained from its pricing actions. The acquisitions of the Spectrum Plastics Group and Donatelle Plastics are also likely to have contributed to third-quarter results.
DuPont’s water business is exposed to headwinds from the slowdown in China. Its water solutions business is seeing sales moderation due to softer demand in China resulting from the downturn in the industrial economy and distributor inventory de-stocking. The de-stocking within industrial-based and water end markets and weaker water demand in China are likely to have continued in the third quarter. DuPont sees sales in the Water & Protection unit to decline by low-single digits year-over-year in the third quarter.
The Industrial Solutions business also faces headwinds from de-stocking within biopharma applications. Organic sales in this business declined by low-double digits year-over-year in the second quarter due to lower volumes. While DuPont is seeing a recovery, additional channel inventory de-stocking within its industrial-based businesses is likely to have continued in the third quarter.