Dow Inc. (DOW) shares are slightly up in early trading as the stock received an upgrade to "buy" from JPMorgan and a price target of $55.
Video Transcript
- All right. Let's take a look at Dow this morning. And JP Morgan upgrading that stock to buy with a price target of $55. We're looking at gains of just about 1%. Now, JP Morgan pointing to Dow's valuation, noting that the stock's underperformance here most recently shares essentially flat since the start of the year.
When you take a look at what JP Morgan likes about Dow, a lot of it has to do with the dividend yield of just about 5.6%. And they're also pointing to the fact that the company has a strong balance sheet. The correlation with oil prices as well. Now, we have not seen Dow move up, as we've seen oil prices really take off. But JP Morgan making the point that that has the potential here to be a catalyst, at least, in the short term for Dow Inc.
- Yeah. They said the downward momentum or movement, rather, in equity values has given investors an opportunity to purchase Dow shares at a reasonable valuation. All this to consider-- we're taking a look at the year to date view here. It hasn't been a stellar outperformer, and it hasn't outperformed at all, actually.
It's been to the downside by about 3/4 of or 3/10 of a percent over the course of this year here. So not really participating in the Dow rally, the S&P 500 rally, or the NASDAQ rally. In fact, it's just lagged everything. So at this point in time, that's really much of the case that JP Morgan is making here in that this dip is a potential buying opportunity here.
