Dow Inc. closed at $23.11, reflecting a 1.09% increase, which is better than the S&P 500’s loss of 0.09%. During the same trading day, the Dow index fell by 0.38%, while the Nasdaq saw a slight rise of 0.13%. In the last month, Dow Inc.’s shares climbed 3.44%. This is below the Basic Materials sector’s growth of 3.88% but higher than the S&P 500’s 1.89% increase. Investors are eagerly awaiting Dow Inc.’s upcoming earnings report, which is expected to show revenue of $9.53 billion, down 8.45% from the same quarter last year.

Annual Forecasts and Analyst Estimates

Analysts forecast Dow Inc. will have earnings of -$0.99 per share and revenue of $40.03 billion. These figures represent declines of 157.89% and 6.82%, respectively, from last year. Changes in analyst expectations are critical for understanding current business trends, with upward revisions often suggesting a positive outlook. The Zacks Rank system rates stocks from #1 (Strong Buy) to #5 (Strong Sell) and has a solid track record. Stocks rated #1 have averaged annual returns of +25% since 1988. Recently, the consensus EPS estimate for Dow Inc. increased by 0.55%, giving it a Zacks Rank of #3 (Hold). The recent performance indicates that Dow Inc. has been doing better than the broader market on both daily and monthly scales. DOW’s shares are more resilient than the S&P 500, even though they have not kept pace with its sector. This stability hints at some support for the stock price ahead of the earnings release. However, the upcoming earnings report poses a significant risk, with expectations of a major decline. We forecast a revenue drop of over 8% compared to last year and a full-year net loss per share. This stark year-over-year comparison serves as the main bearish signal for traders. Despite the gloomy annual forecast, there has been a slight upward adjustment in earnings estimates over the last 30 days, showing some recent optimism among analysts. Traders should see this as a mixed signal that could lead to volatility around the earnings announcement.

Broader Economic Factors

Examining the larger economy, the drop in oil prices during the fourth quarter of 2025 has eased input costs for chemical companies. This trend may be contributing to the minor positive estimate revisions. However, this cost relief may not adequately counter weak demand. Global demand continues to be a worry, as global manufacturing PMIs have struggled to remain above the 50-point expansion mark for much of 2025. Economic signals from China remain mixed, adding uncertainty to the demand for basic materials. This weak demand supports the forecast of declining annual revenue. High interest rates, a result of inflation in 2023, continue to dampen new construction and industrial projects. This environment of short-term stock momentum contradicting poor fundamental forecasts is suitable for volatility-driven strategies, such as straddles or strangles. It contrasts sharply with the post-pandemic housing boom of 2022, where material demand was soaring. It’s important to note that DOW operates in an industry currently ranked in the bottom 13% of all sectors we monitor. This indicates that the challenges facing the company are industry-wide and not unique to it. This weak sector backdrop supports a cautious or bearish approach to any directional trades. Create your live VT Markets account and start trading now.

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