5 Best Chemical Stocks to Buy For 2021

4. Dow Inc (NYSE: DOW)

Michigan-based Dow  ranks 4th on the list of 10 best chemical stocks to buy for 2021. The company, which has a market cap of over $41 billion, was given a strong rating by J.P. Morgan on the back of strong growth prospects in the polyethylene market. The firm upgraded Dow stock to Overweight from Neutral, and upped its price target to $60 from $47.

The stock has gained over 15% in the last 3 months.

Smart money loaded up on Dow stock in the third quarter, as 42 hedge funds in our database ended the period with Dow shares in their portfolios, up from 35 funds a quarter earlier. The total value of these stakes is $512.4 million. Here is what Evermore Global said about DOW and DD in its 2020 Q1 investor letter:

“With respect to Corteva, Dow and DuPont, COVID-19 related shutdowns that started in China painted an ominous picture for the global macro landscape, and we exited our positions in these three companies that comprised the former DowDupont (DWDP) beginning in February. Additionally, numerous channel checks we performed indicated that various supply chains were being disrupted and stressed, a poor sign for three companies that are very global in nature.

In retrospect, we remain generally happy with managements execution of many of the fundamental tenets of our original investment thesis in DWDP – the separations and spins were completed on time, the restructuring programs were well executed, and capital allocation across the three companies is much more streamlined and shareholder friendly today than in the past. Unfortunately, big picture issues that started with the U.S. – China trade war and remain today with the global collapse in macroeconomic activity has severely impacted each of the former DWDP companies. We will continue to remain close to each company and could reenter on or more of the aforementioned positions should an opportunity present itself.”