JPMorgan slashes forecasts for Dow, Rohm & Haas
13 October 2008 13:15 [Source: ICIS news]
LONDON (ICIS news)--JPMorgan has lowered its earnings outlook for
Dow’s third-quarter earnings per share (EPS) forecast was reduced to $0.43 from $0.68 as the company was still experiencing significant outages from hurricanes Gustav and Ike, JPMorgan said.
The bank reduced its 2009 estimate for the
JPMorgan said ultimate financing costs for the acquisition of Rohm and Haas were likely to rise due to the tight credit environment, while new capacities in emerging markets would likely to drive down demand for Dow’s ethylene-based products.
“The unpopular R&H acquisition will probably grow more so as R&H’s growth engine, its electronics business, faces new headwinds,” said the bank.
“Acquisition synergies will probably be delayed given the contracting demand environment,” it added.
The bank reduced its 2008 EPS forecast for Rohm and Haas to $3.10 from $3.45 and its 2009 outlook to $3.05 from $4.00.
“The EPS revision reflects weak electronics demand in Asia, slowing demand in Europe, more conservative growth in the
Dow’s proposed $18.8bn (€13.9bn) acquisition of specialty chemicals producer R&H was likely to close in early 2009, the bank said.
($1 = €0.74)
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