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PPG

PPG Industries NYSE:PPG Stock Report

Last Price

US$110.69

Market Cap

US$26.0b

7D

-1.5%

1Y

-23.1%

Updated

02 Oct, 2022

Data

Company Financials +
PPG fundamental analysis
Snowflake Score
Valuation4/6
Future Growth3/6
Past Performance2/6
Financial Health2/6
Dividends4/6

PPG Stock Overview

PPG Industries, Inc. manufactures and distributes paints, coatings, and specialty materials worldwide.

PPG Industries Competitors

Price History & Performance

Summary of all time highs, changes and price drops for PPG Industries
Historical stock prices
Current Share PriceUS$110.69
52 Week HighUS$177.32
52 Week LowUS$107.06
Beta1.16
1 Month Change-10.56%
3 Month Change-6.08%
1 Year Change-23.14%
3 Year Change-5.09%
5 Year Change-2.29%
Change since IPO996.62%

Recent News & Updates

Sep 30
Is PPG Industries (NYSE:PPG) A Risky Investment?

Is PPG Industries (NYSE:PPG) A Risky Investment?

The external fund manager backed by Berkshire Hathaway's Charlie Munger, Li Lu, makes no bones about it when he says...

Sep 15

PPG Industries: Buy This Dividend Giant On The Dip

Summary PPG is a moat-worthy company that has demonstrated pricing power. It has an impressive track record of shareholder returns via share buybacks and dividend growth. I believe the market is underestimating its earnings power and recent share price weakness presents a buying opportunity. Buying and holding onto moat-worthy and economically essential companies is generally a winning strategy for the long haul. What's even better is when these companies can be had at closer to their 52-week lows than their highs. This brings me to PPG Industries (PPG), which is now trading much closer to its 52-week low of $107 than its 52-week high of $177. In this article, I highlight what makes now a good time to pick up this quality name, so let's get started. Why PPG? PPG has been around for almost 140 years and became the world's largest producer of coatings, after its purchase of select Akzo Nobel assets. Its products are sold to a wide variety of end customers, including those in the industrial, aerospace, automotive, and construction markets. The company has a global footprint in over 75 countries, with less than half of sales coming from North America in recent years. This is exemplified by its Comex acquisition, which expanded PPG's coatings and specialty products into emerging regions. In 2021, PPG generated $16.8 billion in total sales. PPG continues to exemplify strong growth, with record sales of $4.7 billion in the second quarter, equating to 8% YoY growth from the prior year period. This was driven by higher selling prices, as a demonstration of PPG's pricing power in the market. Selling prices rose by a robust 11% YoY, which more than offset the 4% decline in product volume. Of course, PPG isn't immune to inflationary headwinds, as raw material costs are up 20% YoY, and energy and transportation costs remain elevated, but nevertheless, efficiencies in other areas enabled PPG to improve its segment operating margin by 200 basis points on a sequential basis. Moreover, I see supply bottlenecks and softened consumer demand in its DIY segment as being more transitory in nature, as that was due to lockdowns in China and geopolitical tensions in Europe. In addition, PPG's aerospace and traffic solutions segments saw a solid rebound with 10% and 15% volume growth, respectively. Looking forward, management expects this momentum to continue as it seeks to deliver a strong second half, as noted during the recent conference call: In the second half, year-over-year comparisons will be aided by the sharp declines we experienced last year during the height of the supply disruption that impacted several industries, particularly in the US. Outside of a few commodities, we expect supply chain conditions to continue to improve, including better raw material and transportation availability as our suppliers' production capabilities are returning to a more normal condition. Also, in the second half and specific to PPG, we expect several businesses, including automotive OEMs and Aerospace to deliver strong growth due to large supply deficits and low inventories in these end-use markets. Other PPG-specific positives for the second half are continuing acquisition synergy realization and additional cost savings from previously announced restructuring actions. Meanwhile, PPG sports a strong BBB+ rated balance sheet, it pays a well-covered 2.1% dividend yield that's protected by a 38.5% payout ratio. The dividend has a 7.7% 5-year CAGR and PPG is close to becoming a dividend king with 49 consecutive years of raises under its belt.

Shareholder Returns

PPGUS ChemicalsUS Market
7D-1.5%-1.2%-2.5%
1Y-23.1%-15.4%-23.2%

Return vs Industry: PPG underperformed the US Chemicals industry which returned -15.4% over the past year.

Return vs Market: PPG matched the US Market which returned -23.2% over the past year.

Price Volatility

Is PPG's price volatile compared to industry and market?
PPG volatility
PPG Average Weekly Movement4.5%
Chemicals Industry Average Movement6.4%
Market Average Movement6.8%
10% most volatile stocks in US Market15.5%
10% least volatile stocks in US Market2.8%

Stable Share Price: PPG is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: PPG's weekly volatility (5%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
188349,300Michael McGarryhttps://www.ppg.com

PPG Industries, Inc. manufactures and distributes paints, coatings, and specialty materials worldwide. The company’s Performance Coatings segment offers coatings, solvents, adhesives, sealants, sundries, and software for automotive and commercial transport/fleet repair and refurbishing, light industrial coatings, and specialty coatings for signs; and coatings, sealants, transparencies, transparent armor, adhesives, engineered materials, and packaging and chemical management services for commercial, military, regional jet, and general aviation aircraft. It also provides coatings and finishes for the protection of metals and structures, such as metal fabricators, heavy duty maintenance contractors, and manufacturers of ships, bridges, and rail cars; paints, wood stains, adhesives, and purchased sundries for painting and maintenance contractors, and consumers for decoration and maintenance of residential and commercial building structures; and paints, thermoplastics, pavement marking products, and other technologies for pavement marking.

PPG Industries Fundamentals Summary

How do PPG Industries's earnings and revenue compare to its market cap?
PPG fundamental statistics
Market CapUS$26.01b
Earnings (TTM)US$1.07b
Revenue (TTM)US$17.56b

24.3x

P/E Ratio

1.5x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
PPG income statement (TTM)
RevenueUS$17.56b
Cost of RevenueUS$11.04b
Gross ProfitUS$6.53b
Other ExpensesUS$5.45b
EarningsUS$1.07b

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

Oct 19, 2022

Earnings per share (EPS)4.56
Gross Margin37.16%
Net Profit Margin6.10%
Debt/Equity Ratio112.5%

How did PPG perform over the long term?

See historical performance and comparison

Dividends

2.1%

Current Dividend Yield

52%

Payout Ratio
We’ve recently updated our valuation analysis.

Valuation

Is PPG undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

4/6

Valuation Score 4/6

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Below Fair Value

  • Significantly Below Fair Value

  • Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for PPG?

Other financial metrics that can be useful for relative valuation.

PPG key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue1.9x
Enterprise Value/EBITDA15.4x
PEG Ratio1.5x

Price to Earnings Ratio vs Peers

How does PPG's PE Ratio compare to its peers?

PPG PE Ratio vs Peers
The above table shows the PE ratio for PPG vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyPEEstimated GrowthMarket Cap
Peer Average50.3x
ALB Albemarle
117.5x8.5%US$31.0b
DD DuPont de Nemours
16.2x13.3%US$25.2b
ECL Ecolab
37.2x19.5%US$41.2b
SHW Sherwin-Williams
30.1x10.8%US$52.8b
PPG PPG Industries
24.3x16.4%US$26.0b

Price-To-Earnings vs Peers: PPG is good value based on its Price-To-Earnings Ratio (24.3x) compared to the peer average (50.3x).


Price to Earnings Ratio vs Industry

How does PPG's PE Ratio compare vs other companies in the US Chemicals Industry?

Price-To-Earnings vs Industry: PPG is expensive based on its Price-To-Earnings Ratio (24.3x) compared to the US Chemicals industry average (13.9x)


Price to Earnings Ratio vs Fair Ratio

What is PPG's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

PPG PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio24.3x
Fair PE Ratio23.8x

Price-To-Earnings vs Fair Ratio: PPG is expensive based on its Price-To-Earnings Ratio (24.3x) compared to the estimated Fair Price-To-Earnings Ratio (23.8x).


Share Price vs Fair Value

What is the Fair Price of PPG when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: PPG ($110.69) is trading below our estimate of fair value ($204.25)

Significantly Below Fair Value: PPG is trading below fair value by more than 20%.


Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is more than 20% higher than the current share price and analysts are within a statistically confident range of agreement.


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Future Growth

How is PPG Industries forecast to perform in the next 1 to 3 years based on estimates from 21 analysts?

Future Growth Score

3/6

Future Growth Score 3/6

  • Earnings vs Savings Rate

  • Earnings vs Market

  • High Growth Earnings

  • Revenue vs Market

  • High Growth Revenue

  • Future ROE


16.4%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: PPG's forecast earnings growth (16.4% per year) is above the savings rate (1.9%).

Earnings vs Market: PPG's earnings (16.4% per year) are forecast to grow faster than the US market (14.8% per year).

High Growth Earnings: PPG's earnings are forecast to grow, but not significantly.

Revenue vs Market: PPG's revenue (2.8% per year) is forecast to grow slower than the US market (7.7% per year).

High Growth Revenue: PPG's revenue (2.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: PPG's Return on Equity is forecast to be high in 3 years time (27.7%)


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Past Performance

How has PPG Industries performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

  • Quality Earnings

  • Growing Profit Margin

  • Earnings Trend

  • Accelerating Growth

  • Earnings vs Industry

  • High ROE


0.7%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: PPG has high quality earnings.

Growing Profit Margin: PPG's current net profit margins (6.1%) are lower than last year (9.7%).


Past Earnings Growth Analysis

Earnings Trend: PPG's earnings have grown by 0.7% per year over the past 5 years.

Accelerating Growth: PPG's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: PPG had negative earnings growth (-29.6%) over the past year, making it difficult to compare to the Chemicals industry average (21.1%).


Return on Equity

High ROE: PPG's Return on Equity (17.4%) is considered low.


Discover strong past performing companies

Financial Health

How is PPG Industries's financial position?

Financial Health Score

2/6

Financial Health Score 2/6

  • Short Term Liabilities

  • Long Term Liabilities

  • Debt Level

  • Reducing Debt

  • Debt Coverage

  • Interest Coverage

Financial Position Analysis

Short Term Liabilities: PPG's short term assets ($7.8B) exceed its short term liabilities ($5.2B).

Long Term Liabilities: PPG's short term assets ($7.8B) do not cover its long term liabilities ($10.1B).


Debt to Equity History and Analysis

Debt Level: PPG's net debt to equity ratio (96.6%) is considered high.

Reducing Debt: PPG's debt to equity ratio has increased from 80.1% to 112.5% over the past 5 years.

Debt Coverage: PPG's debt is not well covered by operating cash flow (11.9%).

Interest Coverage: PPG's interest payments on its debt are well covered by EBIT (16.6x coverage).


Balance Sheet


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Dividend

What is PPG Industries's current dividend yield, its reliability and sustainability?

Dividend Score

4/6

Dividend Score 4/6

  • Notable Dividend

  • High Dividend

  • Stable Dividend

  • Growing Dividend

  • Earnings Coverage

  • Cash Flow Coverage


2.13%

Current Dividend Yield

Dividend Yield vs Market

PPG Industries Dividend Yield vs Market
How does PPG Industries dividend yield compare to the market?
SegmentDividend Yield
Company (PPG Industries)2.1%
Market Bottom 25% (US)1.7%
Market Top 25% (US)4.7%
Industry Average (Chemicals)2.4%
Analyst forecast in 3 Years (PPG Industries)2.3%

Notable Dividend: PPG's dividend (2.13%) is higher than the bottom 25% of dividend payers in the US market (1.67%).

High Dividend: PPG's dividend (2.13%) is low compared to the top 25% of dividend payers in the US market (4.73%).


Stability and Growth of Payments

Stable Dividend: PPG's dividends per share have been stable in the past 10 years.

Growing Dividend: PPG's dividend payments have increased over the past 10 years.


Earnings Payout to Shareholders

Earnings Coverage: With its reasonable payout ratio (52.2%), PPG's dividend payments are covered by earnings.


Cash Payout to Shareholders

Cash Flow Coverage: With its high cash payout ratio (157.6%), PPG's dividend payments are not well covered by cash flows.


Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

4.7yrs

Average management tenure


CEO

Michael McGarry (64 yo)

7.25yrs

Tenure

US$13,199,616

Compensation

Mr. Michael H. McGarry serves as Chairman of the Board for Tikkurila Oyj since June 14, 2021. He has been the Chief Executive Officer and Chairman of the Board at PPG Industries, Inc. since September 1, 20...


CEO Compensation Analysis

Michael McGarry's Compensation vs PPG Industries Earnings
How has Michael McGarry's remuneration changed compared to PPG Industries's earnings?
DateTotal Comp.SalaryCompany Earnings
Jun 30 2022n/an/a

US$1b

Mar 31 2022n/an/a

US$1b

Dec 31 2021US$13mUS$1m

US$1b

Sep 30 2021n/an/a

US$1b

Jun 30 2021n/an/a

US$2b

Mar 31 2021n/an/a

US$1b

Dec 31 2020US$16mUS$1m

US$1b

Sep 30 2020n/an/a

US$1b

Jun 30 2020n/an/a

US$1b

Mar 31 2020n/an/a

US$1b

Dec 31 2019US$15mUS$1m

US$1b

Sep 30 2019n/an/a

US$1b

Jun 30 2019n/an/a

US$1b

Mar 31 2019n/an/a

US$1b

Dec 31 2018US$12mUS$1m

US$1b

Sep 30 2018n/an/a

US$1b

Jun 30 2018n/an/a

US$1b

Mar 31 2018n/an/a

US$1b

Dec 31 2017US$14mUS$1m

US$1b

Sep 30 2017n/an/a

US$1b

Jun 30 2017n/an/a

US$704m

Mar 31 2017n/an/a

US$546m

Dec 31 2016US$12mUS$1m

US$543m

Sep 30 2016n/an/a

US$751m

Jun 30 2016n/an/a

US$1b

Mar 31 2016n/an/a

US$1b

Dec 31 2015US$6mUS$846k

US$1b

Compensation vs Market: Michael's total compensation ($USD13.20M) is about average for companies of similar size in the US market ($USD13.04M).

Compensation vs Earnings: Michael's compensation has been consistent with company performance over the past year.


Leadership Team

Experienced Management: PPG's management team is considered experienced (4.7 years average tenure).


Board Members

Experienced Board: PPG's board of directors are considered experienced (6.3 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

What is the ownership structure of PPG?
Owner TypeNumber of SharesOwnership Percentage
State or Government102,9390.04%
Individual Insiders385,5310.2%
General Public41,406,10117.6%
Institutions193,102,80182.2%

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Top 25 shareholders own 60.42% of the company
OwnershipNameSharesCurrent ValueChange %Portfolio %
8.8%
BlackRock, Inc.
20,672,317$2.3b-1.73%0.06%
8.68%
The Vanguard Group, Inc.
20,403,868$2.3b1.11%0.05%
6.68%
Wellington Management Group LLP
15,700,530$1.7b17.23%0.32%
6.57%
Massachusetts Financial Services Company
15,433,914$1.7b-0.5%0.45%
6.09%
J.P. Morgan Asset Management, Inc.
14,306,869$1.6b14.82%0.3%
4.97%
State Street Global Advisors, Inc.
11,682,267$1.3b2.51%0.07%
2.28%
ClearBridge Investments, LLC
5,346,747$591.8m1.45%0.56%
1.93%
Geode Capital Management, LLC
4,541,925$502.7m0.71%0.07%
1.44%
Wells Fargo & Company, Securities and Brokerage Investments
3,384,183$374.6m1.87%0.17%
1.11%
Teachers Insurance and Annuity Association-College Retirement Equities Fund
2,598,794$287.7m24.74%0.1%
1.03%
Northern Trust Global Investments
2,416,243$267.5m-3.36%0.06%
1%
Managed Account Advisors LLC
2,340,741$259.1m7.55%0.07%
0.96%
Columbia Management Investment Advisers, LLC
2,254,081$249.5m25.66%0.08%
0.93%
Charles Schwab Investment Management, Inc.
2,188,334$242.2m-31.52%0.07%
0.92%
Legal & General Investment Management Limited
2,161,418$239.2m-0.15%0.07%
0.88%
BNY Mellon Asset Management
2,074,029$229.6m4.56%0.05%
0.81%
Putnam LLC
1,894,455$209.7m-0.04%0.36%
0.79%
JPMorgan Chase & Co, Private Banking and Investment Banking Investments
1,850,069$204.8m6.89%0.09%
0.78%
UBS Asset Management
1,842,722$204.0m-5.23%0.04%
0.77%
Ceredex Value Advisors LLC
1,799,565$199.2m7.29%3.09%
0.68%
Norges Bank Investment Management
1,598,169$176.9m0%0.02%
0.63%
Boston Partners Global Investors, Inc.
1,484,029$164.3m61.87%0.14%
0.6%
Eaton Vance Management
1,408,861$155.9m5.84%0.06%
0.56%
ProShare Advisors LLC
1,309,861$145.0m22.14%0.5%
0.55%
Parnassus Investments, LLC
1,296,499$143.5m0%0.37%

Company Information

PPG Industries, Inc.'s employee growth, exchange listings and data sources


Key Information

  • Name: PPG Industries, Inc.
  • Ticker: PPG
  • Exchange: NYSE
  • Founded: 1883
  • Industry: Specialty Chemicals
  • Sector: Materials
  • Implied Market Cap: US$26.012b
  • Shares outstanding: 235.00m
  • Website: https://www.ppg.com

Number of Employees


Location

  • PPG Industries, Inc.
  • One PPG Place
  • Pittsburgh
  • Pennsylvania
  • 15272
  • United States


Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
PPGNYSE (New York Stock Exchange)YesCommon StockUSUSDJan 1968
PPQDB (Deutsche Boerse AG)YesCommon StockDEEURJan 1968
PPQXTRA (XETRA Trading Platform)YesCommon StockDEEURJan 1968
PPG *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNJan 1968
0KEILSE (London Stock Exchange)YesCommon StockGBUSDJan 1968
PPQETLX (Eurotlx)YesCommon StockITEURJan 1968
PPGWBAG (Wiener Boerse AG)YesCommon StockATEURJan 1968
P1PG34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH 2 REPR 1 SHS UNSPONBRBRLJan 2020

Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/10/02 00:00
End of Day Share Price2022/09/30 00:00
Earnings2022/06/30
Annual Earnings2021/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.