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4-Star Stocks Poised to Pop: DuPont

Based on the aggregated intelligence of 130,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, chemicals giant DuPont (NYSE: DD  ) has earned a respected four-star ranking.

With that in mind, let's take a closer look at DuPont's business, and see what CAPS investors are saying about the stock right now.

DuPont facts

Headquarters (founded)

Wilmington, Delaware (1802)

Market Cap

$22.79 billion

Industry

Diversified chemicals

TTM Revenue

$31.75 billion

Management

CEO Ellen Kullman
CFO Jeffrey Keefer

Return on Equity (average, last three years)

28.4%

Dividend Yield

6.5%

Competitors

Dow Chemical (NYSE: DOW  )
Monsanto (NYSE: MON  )
3M (NYSE: MMM  )

CAPS members bullish on DD also bullish on:

General Electric (NYSE: GE  )
Apple (Nasdaq: AAPL  )

CAPS members bearish on DD also bearish on:

American Express (NYSE: AXP  )

Sources: Capital IQ (a division of Standard & Poor's), and Motley Fool CAPS. TTM = trailing 12 months.

Over on CAPS, 1,325 of the 1,404 members who have rated DuPont -- or 94% -- believe the stock will outperform the S&P 500 going forward. These bulls include FinancialPeace and AlphaPuppy.

In February, FinancialPeace highlighted DuPont as a dynamic high-yielder: "Great chemical company that has been beaten down with everything else, nice dividend. I really like how they are focusing on their seed/ag business."

In a pitch from two days ago, AlphaPuppy analyzes DuPont's dividend in greater detail. Below is an excerpt, but be sure to check out the entire pitch here:

Normally, I would associate a 7% dividend yield with a high-probability that the market correctly understands the dim prospects for the dividend. However, these are far from normal times; and I am disposed to conclude that the market is correctly discounting little to no growth in earnings for a protracted period of time for Dupont-with virtually all of the prospective investment return to shareholders in the form of dividend income, which the company is in reasonable financial condition to maintain into the foreseeable future between cash flows and the strength of the company's balance sheet.

What do you think about DuPont, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. More than 130,000 investors are waiting to hear what you have to say. CAPS is 100% free, so simply click here to get started.

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Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Apple is a Motley Fool Stock Advisor recommendation. American Express and 3M are selections of Inside Value. The Fool owns shares of American Express. The Fool's disclosure policy always gets a perfect score.


Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On April 03, 2009, at 11:36 AM, daho65 wrote:

    Sorry, but if Motley Fool is saying this stock is about to "pop", I can only expect the opposite to be true and I will again lose a bundle on their recommendations.

  • Report this Comment On April 06, 2009, at 1:58 AM, gembuyer wrote:

    Down 50% from 52 week high, DD can expect almost 50% upside in this year. Is that a pop? or steady climb?

    Business is down 15%. Add another 10% for the recession. That would put the stock at about $37/share. Lots of upside room from this point forward.

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