PPG stock down 25% from peak, faces soft European demand and slow Chinese recovery

From Nasdaq: 2024-09-26 01:38:15

PPG Industries stock has fallen to around $125 per share, down 25% from its peak in June 2021, unlike its peer, The Sherwin-Williams Company, which is up 40%. PPG faces soft European demand and slow Chinese recovery. However, analysts estimate a potential 18% upside for PPG stock, currently trading at 1.6x trailing revenues.

PPG has underperformed the market for the past three years but remains a less volatile investment option in the Trefis High Quality Portfolio. As the macroeconomic environment remains uncertain, there is debate about whether PPG will see strong growth or underperformance compared to the S&P 500 over the next year. In light of the 2022 inflation shock, PPG’s potential post-inflation trends are being analyzed.

During the 2007-08 crisis, PPG stock dropped by 57% but later surged post-crisis. PPG’s revenues increased from $16.8 billion in 2021 to $18.2 billion in 2023, with earnings per share at $5.35 in 2023. With $7 billion in debt and $1.2 billion in cash, PPG seems equipped to meet its obligations amid the ongoing inflation shock.

PPG Industries has the potential for gains once recession fears subside, although risks include soft demand in Europe and a slow Chinese recovery. Returns for PPG and the S&P 500 reflect market trends and the company’s performance. Trefis analysis indicates a potential for growth in PPG stock, with room for some gains in the future.



Read more at Nasdaq: What’s Happening With PPG Stock?