Dow Chemical Co (DOW): Today's Featured Conglomerates Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model

Dow Chemical ( DOW) pushed the Conglomerates sector lower today making it today's featured Conglomerates laggard. The sector as a whole closed the day down 4.1%. By the end of trading, Dow Chemical fell $0.91 (-2.7%) to $33.19 on average volume. Throughout the day, 10,405,670 shares of Dow Chemical exchanged hands as compared to its average daily volume of 7,483,200 shares. The stock ranged in price between $33.06-$34.24 after having opened the day at $33.75 as compared to the previous trading day's close of $34.10. Other companies within the Conglomerates sector that declined today were: Pingtan Marine Enterprise ( PME), down 61.5%, MGT Capital Investments ( MGT), down 6.1%, Harbinger Group ( HRG), down 5.2% and Leucadia National Corporation ( LUK), down 3.9%.
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The Dow Chemical Company manufactures and supplies chemical products for use as raw materials worldwide. Dow Chemical has a market cap of $41.9 billion and is part of the chemicals industry. The company has a P/E ratio of 42.2, above the S&P 500 P/E ratio of 17.7. Shares are up 5.5% year to date as of the close of trading on Wednesday. Currently there are 2 analysts that rate Dow Chemical a buy, 4 analysts rate it a sell, and 13 rate it a hold.

TheStreet Ratings rates Dow Chemical as a buy. The company's strengths can be seen in multiple areas, such as its good cash flow from operations, growth in earnings per share, largely solid financial position with reasonable debt levels by most measures, increase in net income and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the conglomerates sector could consider SPDR Trust Series 1 ( SPY) while those bearish on the conglomerates sector could consider ProShares Short S&P 500 ( SH).

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