"The investment case for Dow Chemical is fundamentally a call on operating rates, a recovery in construction and auto-related end markets, successful pricing to offset raw materials, and effective use of cash for additional bolt-on M&A (Mergers & Acquisitions) and retiring debt," Jefferies analysts said.
Other catalysts for upside scenarios include that additional specialty chemical acquisitions would help reduce cyclicality, and securing LT access to U.S. ethane would help maintain petrochem margins in 2015 to 2025, Jefferies added.
Dow Chemical, based in Midland, MI, is a global manufacturer and supplier of products used primarily as raw materials in the manufacture of customer products and services.
Separately, TheStreet Ratings team rates DOW CHEMICAL as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:
"We rate DOW CHEMICAL (DOW) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its increase in net income, largely solid financial position with reasonable debt levels by most measures, attractive valuation levels, good cash flow from operations and growth in earnings per share. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself."