Look for DD's agriculture business to advance nicely, at double digit rates, in 2009, after a 22% gain in 2008. Pharmaceutical earnings are expected to be roughly flat. Look for raw material and energy costs to dip slightly in 2009.
The negatives: Du Pont's chemicals business should record another large revenue decline, on the global recession, with several, key markets dragging down sales.
Other positives: institutional investor sentiment toward soybean and corn seed sales turned overly bearish, after (not surprisingly) a period when commodities were viewed as being invincible. Look for institutional investors to begin to reposition themselves in soybean / corn seed suppliers in 2009, which also should aid Du Pont's share. The First Call F2009 / F2010 EPS estimates for DD are $1.88 / $2.24.
Stock Analysis: Du Pont is a moderate-risk stock. Consider buying a 25% position in DD now; then buy another 25% in three months, if U.S. and global economic conditions don't worsen substantially. Under any circumstance, don't buy more than 50% of your DD position in the first half of 2009. Sell / Stop Loss if you were to buy shares in this company: $13.
Disclosure: Lazzaro has no positions in stocks, but does own shares in two Pimco Bond Funds: PHDAX and PYMAX.
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