10 Best Plastics and Rubber Stocks to Buy According to Analysts

3. Dow Inc. (NYSE:DOW)

Upside Potential as of January 13: 29.39%

One of the biggest manufacturers of chemicals worldwide and Best Plastics Stocks, Dow Inc. (NYSE:DOW) creates essential parts for a wide variety of consumer and industrial chemical and plastic goods. The company has been in business for over 125 years, and its product line has changed. As a result of the 2019 merger of DowDuPont and the ensuing splits, the firm is now a commodity chemicals firm.

Dow Inc. (NYSE:DOW) produces a variety of plastics, sealants, adhesives, and additives for use in industrial, automotive, personal care, packaging, and building end markets. This plastics company offers investors a place in a vast and varied materials sciences portfolio that produced net sales of $39 billion in 2020.

Dow Inc. (NYSE:DOW) reported $10.88 billion in revenue for the third quarter of 2024, a 1.4% increase YoY. Volume increased by 1% over the previous year, driven by gains in Performance Materials & Coatings. Higher integrated margins in the Packaging & Specialty Plastics division were the primary driver of the $142 million annual improvement in operating EBIT. The operating cash flow was $800 million, which was $858 million less than the previous year. Higher inventory levels required to sustain sales growth and labor-related supply chain interruptions were the primary causes of this reduction. Furthermore, its free cash flow decreased to $64 million from $1.06 billion in the same quarter the previous year.

There has been significant progress on the Fort Saskatchewan Path2Zero project, with around 40% of the cracker filings finished and considerable foundation work underway. Moreover, Dow Inc. (NYSE:DOW) completed the purchase of polyethylene recycler Circulus, adding 50,000 metric tons of capacity for recycled materials yearly, and negotiated a long-term contract with Linde for a clean hydrogen supply.

Dow Inc. (NYSE:DOW) remains a great choice for income-focused investors in spite of recent setbacks. It distributed $490 million in dividends to stockholders in the most recent quarter. Furthermore, since 1912, the business has never missed a dividend payment.

Richard S. Pzena’s Pzena Investment Management was the largest stakeholder in the company among the funds in Insider Monkey’s database at the end of Q3 2024. It owns 18.95 million shares worth $1.03 billion as of Q3.