11:12 AM EDT, 10/24/2025 (MT Newswires) -- Dow (DOW) shares surged after better-than-expected Q3 earnings before interest, taxes, depreciation and amortization and Q4 Ebitda guidance, but the rally may prove temporary given continued weak demand in consumer, building and construction, and industrial markets, RBC Capital Markets said in a note emailed Friday.

The analysts said that during the company's earnings call, Chief Executive Jim Fitterling highlighted ongoing challenges, including trade uncertainty, rising natural gas liquid costs, and weak global demand. He noted that while Dow sees long-term growth opportunities in its planned $6 to $7 billion net-zero Alberta cracker project, the initiative remains on hold pending better market conditions.

Fitterling added that in the near term, Dow expects a slight margin decline in the Packaging & Specialty Plastics, or P&SP, segment due to higher feedstock costs, although Q3 margins in both P&SP and Industrial Intermediates & Infrastructure improved thanks to new production capacity coming online, the analysts said.

The analysts raised their Ebitda forecasts to $725 million for Q4, $3.24 billion for full-year 2025, and $3.70 billion for 2026, from $678 million, $3.05 billion, and $3.45 billion, respectively, primarily due to the Q3 beat and Q4 guide and cost reductions. They added that they "remain cautious on Dow and other commodity names, as we are not seeing any material demand improvement in Consumer, B&C, or Industrial end markets."

RBC raised its price target on Dow to $27 from $24 and kept its sector perform rating.

Price: 24.51, Change: -0.01, Percent Change: -0.02