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PPG Industries (PPG) Wraps Up Worwag Buyout, Expands Portfolio

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PPG Industries, Inc. (PPG - Free Report) recently announced the completion of the acquisition of global manufacturer of coatings for industrial and automotive applications, Worwag.

Worwag’s operations are based in Germany, the United States, China, South Africa, Mexico, Spain, Switzerland and Poland, with headquarters in Stuttgart, Germany. It specializes in the development of sustainable liquid, powder and film coatings. Worwag was founded in 1918, and currently employs about 1,100 people worldwide.

PPG Industries stated that the acquisition of Worwag is an additional step in its strategic growth plan that will provide further value to customers and shareholders. Both, PPG Industries and Worwag, have a strong history of providing high-quality and sustainable solutions.

Worwag’s expertise in powder and liquid coatings for industrial and automotive applications complements PPG Industries’ business and will enable it to expand its product portfolio. The inclusion of Worwag boosts PPG Industries’ waterborne, direct-to-metal, liquid and powder coatings offerings and helps expand current customer distribution in key geographies.

PPG Industries is looking forward to develop an industry-leading automotive coatings portfolio and serve consumers in new ways, the company noted.

Shares of PPG Industries have rallied 85.5% in the past year compared with 68.8% rise of the industry.

PPG Industries, in its last earnings call, stated that it expects overall global coatings demand to continue to be broad-based in many of its end-use markets, including an eventual replenishment of many of its customers’ inventories.

The company also expects to achieve further sales growth and earnings accretion from its recent acquisitions. It expects sequential net sales to rise a low-teen percentage in the second quarter compared with the first quarter and in line with historical pre-pandemic sequential quarterly changes.

PPG Industries also expects structural cost savings from restructuring actions of roughly $30 million year over year in the second quarter. The company also sees adjusted earnings for the second quarter to be $2.15 -$2.2 per share.

 

Zacks Rank & Other Key Picks

PPG Industries currently carries a Zacks Rank #2 (Buy).

Some other top-ranked stocks in the basic materials space are Dow Inc. (DOW - Free Report) , Celanese Corporation (CE - Free Report) and Cabot Corporation (CBT - Free Report) .

Dow has a projected earnings growth rate of roughly 261.5% for the current year. The company’s shares have surged 91.4% in a year. It currently flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Celanese has an expected earnings growth rate of around 68.3% for the current year. The company’s shares have gained 90.8% in the past year. It currently sports a Zacks Rank #1.

Cabot has an expected earnings growth rate of around 126% for the current fiscal. The company’s shares have gained 77.9% in the past year. It currently flaunts a Zacks Rank #1.

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