HomeMost PopularInvestingWhy Investing in PPG Industries (PPG) Stock is a Smart Move

Why Investing in PPG Industries (PPG) Stock is a Smart Move

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Estimates Point to Growth

PPG Industries, Inc. (PPG) is experiencing positive growth prospects, making it an attractive investment option. Over the past three months, the Zacks Consensus Estimate for PPG’s 2023 earnings has increased by approximately 3.6%. Similarly, the consensus estimate for 2024 has been revised upward by around 6.2%. These favorable estimate revisions indicate investor confidence in the stock.

Consistent Earnings Performance

PPG has consistently outperformed the Zacks Consensus Estimate, with three out of the last four quarters seeing positive earnings surprises. The company has maintained an average trailing four-quarter earnings surprise of 7.3%, further highlighting its strong financial performance.

Robust Growth Potential

The Zacks Consensus Estimate for PPG’s 2023 earnings is projected to be $7.51, which implies a year-over-year growth rate of 24.1%. Additionally, the company is expected to achieve an 11.6% growth in earnings in 2024. These positive growth projections indicate a promising future for PPG Industries.

Driving Factors for PPG

PPG Industries benefits from various factors that drive its growth. The company has implemented pricing actions across its segments and achieved manufacturing efficiencies, cost actions, and strong performance-driven acquisitions.

PPG is focused on cost-cutting and restructuring strategies, which have resulted in incremental cost reductions and optimization of working capital requirements. The cost savings generated by these efforts have positively impacted the company’s financial performance. Moreover, PPG Industries has made significant progress in increasing consolidated segment margins through pricing measures, which are expected to continue supporting profitability in the upcoming quarters.

PPG Industries is also expanding its business through strategic acquisitions. Recent acquisitions, including Tikkurila, Worwag, and Cetelon, are expected to contribute to its top line in 2023.

PPG Industries Stock Analysis

PPG Industries, Inc. Price and Consensus

Other Promising Stocks in the Basic Materials Space

If you’re considering investing in the basic materials sector, here are some other top-ranked stocks worth looking into:

  • Hawkins, Inc. (HWKN) has a projected earnings growth rate of 18.9% for the current year. It currently carries a Zacks Rank #1 (Strong Buy).
  • Carpenter Technology Corporation (CRS) is expected to see a year-over-year growth in earnings of 205.3%. It currently carries a Zacks Rank #2.
  • Alamos Gold Inc. (AGI) has a Zacks Consensus Estimate for current-year earnings that has been revised upward by 7.5% over the past 60 days. It currently carries a Zacks Rank #2.

Conclusion

Considering the positive growth prospects and strong financial performance of PPG Industries, investing in PPG stock appears to be a wise decision. With a track record of exceeding earnings expectations and a focus on efficient operations, cost management, and strategic acquisitions, PPG Industries is well-positioned for continued success in the market.

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