DuPont stock price target raised to $89 by UBS ahead of electronics spin-off

Investing.com - UBS raised its price target on DuPont (NYSE:DD) to $89.00 from $87.00 on Monday, while maintaining a Buy rating on the chemical company’s stock. According to InvestingPro data, DuPont currently trades at an EV/EBITDA of 11.6x and shows GOOD overall financial health, with particularly strong scores in profitability and price momentum.

The price target increase comes approximately three months before DuPont’s planned November 1 spin-off of its electronics business, known as Qnity, which represents about 45% of the company’s $3.2 billion EBITDA. The company maintains strong fundamentals, with a healthy current ratio of 1.4 and five analysts recently revising their earnings estimates upward.

UBS noted that DuPont stock is currently trading at approximately 11 times its estimated 2025 EBITDA, which the firm believes undervalues both the electronics business (Qnity) and the remaining DuPont operations.

The research firm suggested that a more conservative valuation basis for both parts of the business should push the stock to approximately 12 times EBITDA, potentially driving 8-15% outperformance depending on whether investors are looking at 2025 or 2026 estimates.

UBS also mentioned that potential U.S. sectoral tariff announcements on semiconductors and electronics expected by the end of July might cause some investors to wait, but anticipated increased investor involvement between August and October ahead of the spin-off.

In other recent news, DuPont has reiterated its strategic plans with the appointment of new board members for its upcoming electronics business spinoff, Qnity Electronics, Inc. Mark A. Blinn and Dr. Yi Hyon Paik have been appointed as chairman and director, respectively, with the spinoff targeted for completion by November 1, 2025. RBC Capital has maintained an Outperform rating on DuPont, citing potential proceeds from the spinoff and an attractive current valuation as key factors. Additionally, DuPont has introduced a new chromatography resin, AmberChrom™ TQ1, aimed at enhancing biopharmaceutical purification processes, which is expected to improve efficiency in drug development.

In a separate development, DuPont has partnered with Epicore Biosystems to integrate sweat-sensing wearable technology with its protective clothing, aiming to enhance worker safety through real-time hydration tracking. This collaboration underscores DuPont’s commitment to advancing worker safety technologies. Meanwhile, Hotel101 Global Holdings Corp. has received SEC clearance for its merger with JVSPAC Acquisition Corp., paving the way for its Nasdaq listing. This merger, subject to shareholder approval, is expected to value Hotel101 at $2.3 billion and marks a significant step for the Filipino-owned company in its global expansion strategy.

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