Chemicals · NYSE
Current Price
$39.55
Intrinsic Value
Use the calculator below to estimate
Run a full DCF analysis on Dow Inc. with auto-filled fundamentals, adjustable assumptions, and sensitivity heatmap.
Dow Inc. provides various materials science solutions for packaging, infrastructure, mobility, and consumer applications in the United States, Canada, Europe, the Middle East, Africa, India, the Asia Pacific, and Latin America. It operates through Packaging & Specialty Plastics, Industrial Intermediates & Infrastructure, and Performance Materials & Coatings segments. The Packaging & Specialty Plastics segment provides ethylene, and propylene and aromatics products; and polyethylene, polyolefin elastomers, ethylene vinyl acetate, and ethylene propylene diene monomer rubbers. The Industrial Intermediates & Infrastructure segment offers ethylene oxides, propylene oxides, propylene glycol and polyether polyols, aromatic isocyanates and polyurethane systems, coatings, adhesives, sealants, elastomers, and composites. This segment also provides caustic soda, and ethylene dichloride and vinyl chloride monomers; and cellulose ethers, redispersible latex powders, and acrylic emulsions. The Performance Materials and Coatings segment provides architectural paints and coatings, and industrial coatings that are used in maintenance and protective industries, wood, metal packaging, traffic markings, thermal paper, and leather; performance silicones and specialty materials; and silicone feedstocks and intermediates. It also engages in property and casualty insurance, as well as reinsurance business. Dow Inc. was incorporated in 2018 and is headquartered in Midland, Michigan.
ROIC (TTM)
-1.8%
ROE (TTM)
-16.7%
FCF Yield
-4.90%
Based on trailing twelve-month data, DOW shows a free cash flow per share of N/A and a ROIC of -1.8%, key inputs for stock valuation using the DCF method. The P/FCF ratio of N/A and FCF yield of -4.90% are important context metrics when evaluating DOW's stock valuation relative to peers.
The intrinsic value of DOW depends on assumptions about future growth rate, discount rate (WACC), and terminal value. A DCF model discounts projected free cash flows back to present value — small changes in WACC can shift the estimate by 20% or more, which is why sensitivity analysis is essential.
Whether DOW is undervalued depends on comparing the DCF-derived intrinsic value to the current market price of $39.55. A positive margin of safety (intrinsic value above market price) suggests potential undervaluation, but the degree of confidence depends on the reliability of your growth and discount rate assumptions.
To perform a DCF valuation on Dow Inc.: (1) Start with the trailing free cash flow per share as the base, (2) project future FCF growth over 5-10 years based on Chemicals industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting DOW's risk profile, and (4) add a terminal value for cash flows beyond the projection period.
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For Dow Inc., this means projecting how much free cash flow the Chemicals will produce over the next 5-10 years, then discounting those amounts to today's dollars. DOW's ROIC of -1.8% suggests the company may face challenges generating returns above its cost of capital.
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For DOW, the capital structure and equity risk premium determine WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%.
