DuPont Shares Up 17% in 6 Months: What's Driving the Stock?

Shares of DuPont de Nemours, Inc. DD have gained 16.5% over the past six months. The company has also outperformed its industry's rise of 4.5% over the same time frame. DD has also topped the S&P 500's roughly 9.5% increase over the same period.

Let's take a look into the factors that are driving this Zacks Rank #3 (Hold) stock.

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Productivity, Innovation & Acquisitions Aid DD

DuPont is benefiting from its innovation-driven investment, productivity actions and acquisitions. The company remains focused on driving growth through innovation and new product development. Its innovation-driven investment is focused on several high-growth areas. DD remains committed to driving returns from its R&D investment.

DuPont, in August 2023, completed the buyout of leading manufacturer of specialty medical devices and components, Spectrum Plastics Group from AEA Investors for $1.75 billion. The acquisition strengthens DuPont's existing position in stable and fast-growing healthcare end markets. It is also in sync with its focus on high-growth, customer-driven innovation for the healthcare market.

The buyout of Donatelle Plastics also enhances DD's exposure in healthcare, expanding its expertise in the medical device market segments. The acquisition introduces complementary advanced technologies and capabilities, such as medical device injection molding, liquid silicone rubber processing, precision machining, device assembly and tool building.

Moreover, DuPont is benefiting from cost synergy savings and productivity improvement actions. The benefits of its structural cost actions are expected to be realized in 2024. DD also continues to implement strategic price increases in the wake of cost inflation. These actions are likely to support its results. DuPont is also executing additional restructuring actions and expects annualized cost savings of $150 million from these measures with nearly $115 million anticipated in 2024.

Earnings estimates for DD have also been going up over the past 60 days, reflecting analysts' optimism. The Zacks Consensus Estimate for 2024 has increased around 2.5%. The consensus estimate for 2025 has also been revised 1.7% upward over the same time frame.

Stocks to Consider

Better-ranked stocks in the Basic Materials space are Newmont Corporation NEM, Element Solutions Inc ESI and Agnico Eagle Mines Limited AEM. Newmont and Element Solutions sport a Zacks Rank #1 (Strong Buy), and Agnico Eagle carries a Zacks Rank #2 (Buy).

The Zacks Consensus Estimate for Newmont's current-year earnings is pegged at $2.82, indicating a rise of 75.2% from year-ago levels. The Zacks Consensus Estimate for NEM's earnings has increased 16% in the past 60 days. The stock has rallied around 33% in the past year.

The consensus estimate for Element Solutions' current-year earnings has increased by 0.7% in the past 60 days. ESI beat the consensus estimate in three of the last four quarters while delivering in-line results on the other occasion. In this timeframe, it delivered an earnings surprise of around 3.8%, on average.

The Zacks Consensus Estimate for Agnico Eagle's current-year earnings is pegged at $3.65, indicating a year-over-year rise of 63.7%. AEM's earnings beat the Zacks Consensus Estimate in each of the last four quarters, the average earnings surprise being 15.7%. The company's shares have rallied roughly 71% in the past year.

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