Jim Cramer Says DuPont is an Industrial “Discount”
CNBC’s Jim Cramer said Wednesday he believes DuPont de Nemours shares are trading at attractive levels, suggesting investors are taking a position in the specialty chemicals maker.
“DuPont just had a great quarter and its stock didn’t do anything because Wall Street just doesn’t get the story, so they don’t give the company enough credit for the fact that” [CEO] Ed Breen’s strategy is paying off, “said the Mad Money presenter.
“With this stock currently trading only 17 times this year’s earnings guidance, I speak to DuPont for a bargain,” added Cramer, a day after DuPont topped Wall Street’s quarterly expectations and its annual guidance for revenue, operating EBITDA and adjusted earnings each Share.
Cramer said he believes DuPont stock would have added at least a dollar under normal circumstances following this report, but instead the stock fell on Tuesday. It also fell 0.17% on Wednesday to close at $ 74.26.
“What is the problem? I think Wall Street is profoundly misunderstanding that there is a new DuPont. This thing is trading like it’s just some sort of commodities or commodity chemistry game, so it’s still trading well below its highs from early May … though history just keeps getting better, “Cramer said.
DuPont has strong management, with Breen at the helm, Cramer said, and he claimed that the company’s product offerings are more proprietary than some other material stocks. Under Breen’s leadership, DuPont has also divested non-core businesses and made smart acquisitions in key end markets.
Cramer said his charitable trust therefore owns shares in DuPont, which was part of the larger DowDuPont, before its businesses were split into three independent parts: DuPont, Dow Inc. and Corteva.
“In short, this is a higher quality company than Wall Street seems to recognize,” said Cramer, adding that he wants viewers to “see the opportunity in the industry’s bargain bin before it goes away.”