There are fewer stocks closer to the Dow Jones Industrials than this giant, and few stocks in the average more ripe for a comeback, writes Pat McKeough of TSI Network.

Dow Chemical (DOW) is the world's second-largest chemical maker. (BASF SE of Germany is the largest).

Based in Midland, Michigan, Dow makes over 5,000 products at 197 plants in 36 countries. Europe, the Middle East, and Africa account for 35% of its revenue, followed by the rest of the world (33%) and the United States (32%).

Dow operates through six main divisions: Performance Plastics, Performance Materials, Feedstocks & Energy, Coatings & Infrastructure Solutions, Agricultural Sciences, and Electronic and Functional Materials.

In 2011, Dow's revenue rose 11.8%, to $60 billion, from $53.7 billion in 2010. The company raised its prices by 13% to cover the higher cost of oil and natural gas liquids like ethane, which it needs to make its products. This offset a 1% drop in sales volumes, and was the main reason for the higher revenue.

The company's earnings for the year rose 28.5%, to $3.6 billion from $2.8 billion. Earnings per share rose 19.2%, to $2.05 from $1.72, on more shares outstanding. Without unusual items, such as gains on asset sales, earnings per share would have risen 28.9%, to $2.54 from $1.97.

The earnings increase was mainly due to savings from a series of restructurings over the past few years. These measures included closing plants and cutting jobs.

The company is also producing more specialty chemicals, which are more profitable than regular chemicals. In addition, specialty chemicals are often protected by patents. This helps shield Dow from competition.

As part of this expansion, Dow paid $15.7 billion for specialty chemical maker Rohm and Haas in April 2009. The purchase made Dow the world's largest specialty-chemical maker.

In the second quarter of 2011, the company raised its quarterly dividend by 66.7%, to 25 cents a share. The shares now yield 2.8%. The stock now trades at 11.7 times the $3.05 a share that Dow will probably earn in 2012.

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