Dow AgroSciences LLC, a wholly owned subsidiary of
The Dow Chemical Company
), entered into a three-year research deal with PPD's China-based
drug discovery company, BioDuro.
The collaboration aims to generate novel molecules for
synthesizing and testing fungicides, insecticides and herbicides
across a variety of crops. The companies did not disclose any
financial terms of the agreement.
The two companies are expected to utilize BioDuro's expertise in
medicinal chemistry and biochemistry and Dow AgroSciences'
agrochemical capabilities in the collaboration aimed for an
With the best research team of BioDuro, Dow AgroSciences intends
to develop its research capabilities while providing its customers
with innovative solutions. On the other hand, BioDuro aims to
develop novel molecules with advanced research in the agrochemical
Recently, Dow released its fourth-quarter 2011 results. The
company earned 25 cents per share, missing the Zacks Consensus
Estimate of 32 cents per share as well as earnings of 47 cents per
share in the prior-year quarter. However, including one-time
charges, the company reported a loss of 2 cents per share, compared
with earnings of 37 cents per share in the year-ago quarter.
Though total revenue in the quarter inched up 2% to $14.1
billion, it was below the Zacks Consensus Estimate of $14.4
billion. Sales increased across all operating segments and
geographic areas, except Electronic and Functional Materials.
Volumes declined 3% year over year, but were flat excluding the
impact of divestitures. For full-year 2011, sales increased 12% to
Dow did not provide any financial guidance. However, the company
anticipates that it will continue facing challenges from Western
Europe in the near term.
The company did not forecast much improvement in market
conditions for the first quarter of the year, but it has projected
that economic recovery will gain momentum in the second quarter and
the remainder of the year. The company expects to meet its short
and long-term targets irrespective of the economic conditions.
The company expects its downstream, market-driven businesses to
continue to capture value from improving North American feedstock
dynamics. Dow expects ethylene industry operating rates to tighten
over the next several years, driving margin expansion. The company
will keep its focus on generating enough cash flow while repaying
its shareholders and funding organic growth.
DOW faces stiff competition from
EI DuPont de Nemours & Co.
), which released its fourth-quarter 2011 results on January 24,
2012 delivering earnings of 35 cents per share compared with 50
cents in the year-ago quarter.
Currently, DOW has a Zacks #3 Rank on its shares, which
translates to a short-term (1 to 3 months) '"Hold' rating. However,
we are maintaining a long- term (more than 6 months) "Neutral"
recommendation on the shares.
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