DuPont de Nemours, Inc. (DD)

FairStock Score: 28/100 — RISKY

Key Financials

Strengths

• Established market positions in Tyvek brand and water filtration technologies with pricing power
• Conservative balance sheet with D/E ratio of 0.24 providing financial flexibility
• Diversified revenue streams across healthcare, water, and industrial segments reducing single-market risk
• Substantial free cash flow generation of $13.4B demonstrates underlying cash generation capability

Concerns

• Negative quarterly revenue and net loss of $126M indicates severe operational distress or major restructuring
• Abysmal returns: ROE of 0.52% and ROCE of 1.86% suggest systematic capital destruction
• Deteriorating financial health signals: Piotroski F-Score of 4/9 and Altman Z-Score near distress threshold of -0.06
• Valuation metrics unreliable due to negative earnings; Fair Stock Score of only 28/100 signals overvaluation

AI Analysis

I'm troubled by what I see in DuPont's financials. While the company operates in defensible specialty chemical markets with recognizable brands like Tyvek, the numbers tell a cautionary tale. A P/E of 202 with negative EPS is meaningless—this isn't a valuation, it's a warning sign. The latest quarter shows negative revenue of $1.9B and a $126M net loss, suggesting significant operational deterioration or accounting adjustments from restructuring. Most alarming: ROE of 0.52% and ROCE of 1.86% are abysmal for a $18.9B market cap company. These returns barely exceed the risk-free rate, indicating capital destruction rather than creation. The Piotroski F-Score of 4/9 and Altman Z-Score of -0.06 suggest financial distress. However, I note the $13.4B in free cash flow, though the negative FCF yield of -2.9% is perplexing given the market cap. The low debt-to-equity of 0.24 provides some cushion. The company's diversified business—healthcare, water filtration, protective materials—has merit, but current execution is failing shareholders. At $45.22, this appears expensive for a turnaround story with deteriorating fundamentals. I require a margin of safety before investing in troubled companies; this lacks it. The Fair Stock Score of 28/100 confirms my skepticism.

Bull Case

DuPont possesses valuable intellectual property and market positions in growing end-markets like healthcare and water treatment. A successful turnaround could unlock substantial value, especially given the conservative balance sheet and strong underlying cash generation potential.

Bear Case

The company is destroying shareholder capital with single-digit returns on equity and capital. Negative recent results suggest operational momentum is deteriorating, and the stock price may not fully reflect the depth of the turnaround required.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer