PPG Industries Faces Challenges While Analysts Remain Hopeful
PPG Industries, Inc. (PPG), a company established in 1883 and based in Pittsburgh, Pennsylvania, is a leading global player in paints, coatings, and specialty materials. With a market cap of $27.7 billion, PPG has built a reputation for its innovative solutions that protect and enhance surfaces across a wide range of sectors, including automotive, aerospace, construction, and industrial applications.
As a member of the large-cap stock category—comprising companies valued at $10 billion or more—PPG seeks to promote long-term success and sustainability within a dynamic marketplace by providing high-performance solutions across diverse fields.
Stock Performance and Recent Trends
Currently, PPG’s shares are trading at levels 20.8% below their 52-week high of $150.82, which occurred on December 28, 2023. Over the last three months, the stock has declined 7.5%, lagging behind the S&P 500 Index’s ($SPX) 2.7% gains during the same time period.
In the year-to-date period, PPG’s stock has fallen by 20.1%, underperforming the S&P 500’s gain of 23.1%. Furthermore, over the past 52 weeks, PPG has decreased by 23%, contrasting sharply with the S&P 500’s corresponding growth of 23%.
The stock has shown bearish signs, trading below its 200-day moving average since April and under the 50-day moving average since October.
Third Quarter Earnings Report and Future Outlook
PPG’s stock took a downward turn in the four sessions after its Q3 earnings report on October 16. During this period, adjusted earnings increased by 2.9% year-over-year to $2.13 per share, slightly falling short of the estimated $2.15. Revenue, meanwhile, dropped by 1.3% to $4.58 billion, which was below the anticipated $4.65 billion. For 2024, PPG forecasts flat organic sales and adjusted EPS at the lower end of the $8.15 to $8.30 range. The company aims to pursue growth opportunities through strategic divestitures and cost management to achieve higher margins.
In comparing PPG’s performance to its competitor, Sherwin-Williams Company (SHW), PPG has struggled significantly, with SHW posting a 9.8% gain year-to-date and an impressive 11.5% rise over the past year.
Analyst Perspective and Market Sentiment
Despite PPG’s underwhelming performance in the market, analysts are moderately optimistic about the company’s future. Out of 22 analysts monitoring PPG, the consensus rating stands at “Moderate Buy.” The mean price target of $148.20 suggests a potential upside of 24% from the current trading price.
On the date of publication, Rashmi Kumari did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are solely for informational purposes. For more details, please view the Barchart Disclosure Policy here.
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
