DuPont de Nemours, Inc. DD
Verdict: Hold. Fair value $44.05 against a price of $42.01 on 6 Jan 2026, 5% above the price.
In plain words
The case for: Narrow competitive moat provides durability. Industry tailwinds with growing market.
The case against: Macro headwinds could impact growth. Valuation multiple compression risk.
Main risks
- Extremely Low Profitability & Returns: Current ROE (3.0%) and ROIC (1.9%) are drastically below industry averages, indicating inefficient use of capital and low profitability on its asset base.
- Volatile and Stagnant Performance: Revenue has been volatile with a negative 3-year CAGR. Net Income and Free Cash Flow have experienced extreme swings, including negative FCF in two of the last four years, suggesting underlying business instability.
- Poor Incremental Returns on Capital: The calculated ROIIC is near zero (0.4%), implying that capital deployed over the past three years has generated virtually no additional operating profit, a major red flag for future value creation.
- Extreme optimism may signal peak (contrarian warning)
- Overbought (RSI: 77)
- Market volatility