DuPont‘s (NYSE:DD) fair price estimate based on expected 2019 earnings is $81, according to Trefis estimates. This is higher than the current market price of around $62. DuPont generates revenues from various businesses, including Nutrition & Biosciences, Transportation and Advanced Polymers, Electronic & Imaging business, Industrial BioSciences, and Safety and Construction. In this note we discuss our stock price valuation for DuPont. You can look at our interactive dashboard analysis ~ DuPont Valuation: Cheap or Expensive? ~ for more details.
#1. Estimating DuPont’s Total Revenues:
- Total Revenues have increased from $70.9 billion in 2016 to $86 billion in 2018, but are expected to fall after the restructuring of the business to $35.7 Billion in 2019, primarily due to the split of business with Corteva and Dow in Q2 2019. Our Interactive Dashboard Analysis, How Does DuPont Make Money?, Provides An In Depth View Of The Company’s Revenues.
#2. Deriving DuPont’s Net Income:
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- Net Income Margin has improved over the years from 8.9% in 2016 to 11.1% of Total Revenue in 2018. In 2019 DuPont’s Margin is expected to be affected by the restructuring of the business with Corteva and Dow and fall to around 8.7% .
#3. Determining DuPont’s EPS:
- EPS has grown from $2.80 in 2016 to $4.13 in 2018, and we estimate it to be $4.17 in 2019.
- EPS growth from 2018 can be attributed to higher Net Income and lower Shares Outstanding.
#4. Estimating DuPont’s Share Price:
- Our Price Estimate of $81 for DuPont’s Stock is based on our Detailed Valuation Model, and implies a 19.4x P/E Multiple on expected 2019 EPS of $4.17
- For further information on how DuPont’s historical P/E fares with its peers, please visit our interactive dashboard – DuPont’s Valuation.
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