From Yahoo Finance: 2025-06-07 04:34:00

Dow Inc. faces challenges like weak demand, global competition, and high costs. Management may consider cutting its dividend, which currently yields 10.3%. Dow’s stock price is down 50% from its spin-off price in 2019. The company makes commodity chemicals used in various industries but lacks pricing power.

Factors like low demand and heightened competition, especially from China, are impacting Dow’s performance. The company is investing in sustainability but paused a major project to reduce spending. Despite some signs of improvement in recent quarters, Dow’s operating margin has declined significantly to 3.3%.

Dow is facing financial pressure, being free-cash-flow negative and unable to cover its dividend expense. The company may need to sell assets, cut spending, or take on more debt to sustain the dividend. It has made moves to save costs and generate additional cash to support operations.

With a high dividend yield of 10.3%, Dow might need to consider cutting its payout. The company aims to have its dividend make up 45% of operating income but must improve margins. Investors should assess whether Dow can navigate its challenges or may need to cut dividends in the future.

Read more: Meet the Only S&P 500 Stock That Yields Over 10%. Here’s Why It Could Be Worth Buying in June.