NEW YORK (TheStreet) -- Shares of Dow Chemical (DOW) - Get Report are rising 0.7% to $54.04 this afternoon as analysts at JPMorgan upgrade the stock to "overweight" from "neutral," only weeks after downgrading.
The initial downgrade was "not for fundamental reasons, but because Dow can trade poorly when cyclical risks are larger," the firm said in a note cited by Barron's. JPMorgan said that market concerns following June's Brexit vote made them reluctant to add to Dow's positions.
However, the company's recent earnings report showed that sales have slid less than expected - revenue declining by 7.4% to $11.95 billion for the 2016 second quarter - and that global demand is "holding up generally well," JPMorgan said.
The company's shareholders also recently approved a $130 billion merger with chemical company DuPont (DD) which is now subject to approval by antitrust commissions in the U.S. and U.K.
"We continue to believe that Dow/DuPont will be a large free cash generator over a longer period of time as Dow's capital expenditures move substantially lower and the company benefits from significant capacity expansions and cost reduction efforts in the consolidation of Dow and DuPont," JPMorgan said.
Dow is a manufacturing company based in Midland, MI.
(Dow Chemical is held in Jim Cramer's charitable trust Action Alerts PLUS. See all of his holding with a free trial here.)
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
TheStreet Ratings rated this stock as a "buy" with a ratings score of B+.
The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels, notable return on equity and solid stock price performance. We feel its strengths outweigh the fact that the company has had sub par growth in net income.
You can view the full analysis from the report here: DOW