COMPANY DESCRIPTION
E.I. du Pont de Nemours and Company (DuPont or 'the company') is a diversified chemical company offering products and services for various markets, including agriculture, nutrition, electronics and communications, and safety and protection. The company operates in North America, Latin America, Asia Pacific, Europe, the Middle East, and Africa. It is headquartered in Wilmington, Delaware
ECONOMIC MOAT
In our opinion, DuPont owns a portfolio of specialty businesses that together form its narrow economic moat. The agriculture business is the biggest contributor to DuPont's moat.
OUTLOOK
The current year is shaping up to be a challenging one for DuPont. The company is operating in a difficult macroeconomic environment. It is facing headwinds related to a stronger U.S. dollar and continued volatility in energy markets. Long-term prospects look bright. The company ought to experience healthy growth from its agriculture and nutrition, bio-based industrials, and advanced materials lines. Efforts to control costs should support margins. Stock buybacks will likely benefit share net in the coming years. This good-quality stock has decent risk-adjusted total return potential.
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STRENGTHS
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Prolific output from innovation pipeline enhancing competitive advantage
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Leadership position in diverse markets enabling to post consistent growth
WEAKNESSES
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Liabilities under CERCLA and RCRA affecting operating results
THREATS
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Volatility in energy and raw material prices could inflate operating costs
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Seasonality in agriculture market likely to affect the company’s overall sales growth
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Changes in government policies and laws could have a negative impact on the company's financial results
OPPORTUNITIES
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Investments in agriculture sector could strengthen DuPont Pioneer business
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Initiatives to strengthen industrial biosciences business
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Development of advanced materials business may help DuPont in increasing its profitability
The above report is for information purposes only, and is not a solicitation or offer to buy or sell any securities. Past performance is no guarantee of future performance. Neither diversification nor asset allocation ensures a profit or guarantees against loss. Before investing, investors should consider their risk tolerance, investment objectives, time horizon, available capital, and charges and expenses.
The information presented in this report has been obtained from sources believed to be reliable, but accuracy and completeness cannot be guranteed. All material is subject to change without notice. The views and opinions expressed are those of Focused Stock Research and/or WALT ST Investment Management, Ltd. and in no way reflect the views and opinions of Investment Consultants nor their Broker Dealers.
