DuPont Is Materially Undervalued
We don't think the market appreciates the company's long-term earnings power.
DuPont de Nemours (DD) is a world-renowned chemical company with a history spanning over 200 years and an ever-evolving portfolio. In its current iteration, DuPont is the specialty chemical company created in 2019 from the DowDuPont merger and subsequent separations. The company’s four business lines each generate roughly one fourth of profits and sell products to different end markets. With 15% of sales to the auto industry and no other end market making up over 5%, DuPont is fairly diversified. We forecast consolidated revenue to grow slightly above global GDP.
DuPont has produced some noteworthy and high-profit products over the years. The safety and construction segment invented products such as Kevlar, which has wide applications in textiles, safety equipment, and transportation. Tyvek, broadly used in construction materials, also demonstrates DuPont's successful product development and innovation. The company has a solid record of innovation, and we think it will be able to replace earnings from older products as they fall out of favor or are leapfrogged by new technologies and as patents expire.
Seth Goldstein does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.