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Credit Suisse 30/06/2010 1 Outperform $4.90 31.0%

Target $4.90 (was $5.75). The company has updated on its current cash flow and working capital positions, the broker taking the view the group will require equity funding to pursue any material growth options in the shorter-term.

The broker expects a capital raising of around $350m, which it estimates would be around 27% dilutive to current FY11 forecasts. Such a raising would imply declining earnings per share in FY11 on the broker's numbers.

Post the update the broker has lowered its valuation and price target to $4.90 but there is no change to its Outperform rating on the stock.

Target price is $4.90 Current Price is $3.74 Difference: $1.16
If DOW meets the Credit Suisse target it will return approximately 31% (excluding dividends, fees and charges).