Bank of America Securities analyst Matthew DeYoe reiterated a Hold rating on DuPont de Nemours today and set a price target of $47.00.
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Matthew DeYoe has given his Hold rating due to a combination of factors impacting DuPont de Nemours. Following the separation of its electronics business, DuPont’s revenue is now evenly split between its traditional industrial markets and the more dynamic healthcare and water sectors. While this strategic shift appears promising for enhancing shareholder value, there is concern that selling lower-value businesses to invest in higher-multiple ones could be earnings dilutive, a challenge seen in similar strategies by European chemical companies.
Despite these concerns, DuPont’s low leverage provides flexibility in cash deployment, and the current valuation at $40 per share is considered reasonable amid cycle headwinds. The potential for the company’s valuation to increase exists as macroeconomic conditions improve, but long-term growth will depend on establishing structural pricing power, which is a strength of its peers. The company’s sales growth is projected at around 2.5% through the cycle, with mature industrial products facing market share challenges, offset by growth in water filtration and medical PPE sectors.
According to TipRanks, DeYoe is a 4-star analyst with an average return of 8.5% and a 64.29% success rate. DeYoe covers the Basic Materials sector, focusing on stocks such as DuPont de Nemours, Corteva, and Nutrien.
In another report released on November 10, Morgan Stanley also maintained a Hold rating on the stock with a $44.00 price target.