Dow Inc. DOW inked a large-scale solar energy contract with Atlas Renewable Energy in Brazil.
Notably, the supply of clean energy will be through the Jacaranda photovoltaic solar plant and is anticipated to supply more than 440GWh per year that will be largely used to serve Dow under a 15-year term contract.
The Jacaranda solar plant is expected to have an installed capacity of 187MWp, with more than 450,000 modules. Notably, the plant will produce ample energy to provide a large portion of Dow’s energy requirements at the Aratu Site.
The solar facility will generate enough electricity to power a city of 750,000 residents, while avoiding around 35,000 metric tons of CO2 emissions annually.
The contract is expected to help Dow achieve its 2025 Sustainability Goals i.e. to obtain 750 megawatts of its power demand from renewable sources. Dow also aims to reduce its net annual carbon emissions by 15% or 5 million tons of CO2 by 2030 and eventually achieve carbon neutrality in 2050.
The company’s shares have lost 17.5% in the past year compared with the 16.3% decline recorded by the industry.
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Dow, on its first-quarter earnings call, said that it is seeing indications of a recovery from the virus outbreak in China, while still assessing the impacts of the same in other major geographies. Factoring in a gradual and sustainable return of global economic activities, and the reopening of economies in May and June, the company expects recovery as the year progresses.
Dow also said that it is taking actions to further strengthen its financial position. These include the reduction of operating expenses by $350 million and further trimming of capital expenditure target to $1.25 billion (a $750-million reduction from that in 2019). The company is also temporarily idling certain manufacturing units to align production to demand across markets, which have been significantly affected by restrained economic activities.
Dow Inc. Price and Consensus
Zacks Rank & Stocks to Consider
The company currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the basic materials space are AngloGold Ashanti Limited AU, Agnico Eagle Mines Limited AEM and Harmony Gold Mining Company Limited HMY.
AngloGold has a projected earnings growth rate of 109.9% for the current year. The company’s shares have surged around 67% in a year. It currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Agnico Eagle has a projected earnings growth rate of 53.6% for the current year. The stock has gained around 25% in a year. It currently has a Zacks Rank of 2.
Harmony Gold has an expected earnings growth rate of 28.6% for 2020. The company’s shares have gained 87% in the past year. It is presently a Zacks #2 Ranked player.
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