DOW
Dow Inc.
$29.93
Stable Earnings Power
40%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Overvalued
Trading 24.7% above fair value
You pay
$29.93
Bear
$19.20
Fair
$24.00
Bull
$28.80
Bear
$19.20
-35.9%
$1.60 × 12x P/E
Fair
$24.00
-19.8%
$1.60 × 15x P/E
Bull
$28.80
-3.8%
$1.60 × 18x P/E
Adjust Assumptions
15.0x
1.6$
Key Value Driver
Normalized P/E multiple (15x base case)
Implied Market Multiple
18.7x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (36 analysts)
$33.80
Divergence from AlphaVal
29%
Summary
Applying a 15x P/E to adjusted EPS of $1.60, the base-case value is $24.00 per share.
Warnings
Wall Street's average price target is $33.80 (from 36 analysts). Our estimate is 29% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples