Why Dow (DOW) Is Down 9.8% After Recent Underperformance And Earnings Uncertainty - And What's Next

• Dow Inc. has come under pressure in recent weeks, with the stock lagging both the broader market and the Basic Materials sector while investors wait for its July 23, 2026 earnings report.
• At the same time, valuation models such as discounted cash flow and price-to-sales suggest the company may be trading below its estimated fair value, sharpening attention on whether upcoming results will bridge the gap between perception and fundamentals.
• Against this backdrop of sustained share weakness and perceived undervaluation, we'll examine how renewed focus on Dow's upcoming earnings shapes its investment narrative.

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Dow Investment Narrative Recap

To own Dow today, you need to believe the company can turn recent losses and weak share performance into stronger, more consistent cash generation, helped by cost cuts, portfolio pruning, and a still-robust balance sheet. The latest share slide and underperformance sharpen attention on the July 23 earnings call as the key short term catalyst, while persistent margin pressure and ongoing losses remain the biggest risk; this recent news does not fundamentally change those priorities.

The upcoming earnings report looms larger in light of Dow’s Q1 2026 results, which showed US$9,794 million in sales and a net loss of US$533 million. That backdrop, combined with models suggesting the shares trade below estimated fair value, puts extra weight on how management explains current profitability, capital allocation, and progress on cost savings when they report in late July.

Yet beneath the focus on earnings, investors should also be aware that...

Read the full narrative on Dow (it's free!)

Dow's narrative projects $45.0 billion revenue and $1.6 billion earnings by 2029. This requires 4.6% yearly revenue growth and about a $4.5 billion earnings increase from -$2.9 billion today.

Uncover how Dow's forecasts yield a $42.62 fair value, a 56% upside to its current price.

Exploring Other Perspectives

Before this drop, the most optimistic analysts were assuming revenue could reach about US$48.5 billion and earnings about US$1.9 billion, which is far more upbeat than views that stress prolonged oversupply and weaker margins, so you should recognise how widely opinions differ and consider how this new stretch of underperformance might shift both sets of expectations.

Explore 5 other fair value estimates on Dow - why the stock might be worth just $35.00!

Decide For Yourself

Don't just follow the ticker - dig into the data and build a conviction that's truly your own.

• A great starting point for your Dow research is our analysis highlighting 4 key rewards and 2 important warning signs that could impact your investment decision.
• Our free Dow research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Dow's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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