A presentation made by UCC's Student Managed Fund to members of Goodbody Stockbrokers recommending an investment in Dow Chemical Corporation. (November 2016)

1. Shaun Devine – UCC SMF

2. Reasons to Buy
Macro
Environment
Proposed Merger
Analyst
Recommendations
Financial
Performance
Competitive
Strategy
Scope for Value
Investing

3. Macro Environment
• Strong Growth Forecast
• 5.2% in 2015
• 19.2% by 2020
• Demand in Asia-Pacific
Year
Speciality
Chemicals Market
2015 936.1
2016 969.6
2017 1,004.4
2018 1,040.4
2019 1,077.7
2020 1,116.3

4. Competitive Strategy
• 3rd largest producer
• Diversified Revenue Streams
• Economies of Scale and Scope
• Present in High Growth Markets

5. Proposed Merger with DuPont
• Merger of Equals
• Subsequent Spin-offs
 Agriculture
 Material Science
 Speciality Products
• Unlock Shareholder Value

6. Financial Performance
Strong Performance
• Net profit Margin
 15 .75% in 2015
 6% in 2011
• ROE of 36.5%
• Average EPS growth of
10.58% 0
0.5
1
1.5
2
2.5
3
3.5
4
4.5
2012 2013 2014 2015 2016 2017
Earnings per Share

7. Scope for Value Investing
Meets a number of indicators
• Low Price:Book ratio
• Low Price:Earnings ratio
• High Dividend Yield
0
5
10
15
20
25
Price:Book Price:Equity Dividend Yield
(%)
Industry Mean
Dow

8. Analyst Recommendations
Period 2015 2016
Buy 6 8
Outperform 7 7
Hold 10 4
Underperform 1 1
Sell 0 0

9. Conclusion
• Stable Stock
• High dividend yield
• Growing, mature industry
• Potential value from merger and spin-offs