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Air Products (APD) Q3 Earnings Beat Estimates, Sales Miss

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Air Products and Chemicals Inc. (APD - Free Report) makes industrial gases as well as a variety of polymer and performance chemicals. It also supplies processing equipment. The company serves technology, energy, industrial and health care customers globally.

Air Products benefits from a diverse customer base, sustained pricing power and cost-reduction measures. New business deals and strategic investments are also expected to support its results. However, Air Products' industrial gases business in the Europe and Latin America is seeing pressure due to sluggish economic conditions. The company is also exposed to currency headwinds and energy price volatility.

Let’s have a quick look at the company’s third-quarter fiscal 2016 release.

Estimate Trend & Surprise History

Investors should note that the earnings estimate for Air Products for the fiscal third-quarter has been static over the last month. Air Products has beaten estimates in all of the last four quarters with an average positive surprise of 2.84%.

AIR PRODS & CHE Price and EPS Surprise

AIR PRODS & CHE Price and EPS Surprise | AIR PRODS & CHE Quote

Earnings

Air Products logged adjusted earnings of $1.92 per share for the fiscal third-quarter, up 16.4% year over year, topping the Zacks Consensus Estimate of $1.91.

Revenues

Air Products posted net sales of $2,434 million for the quarter, down 1% year over year, missing the Zacks Consensus Estimate of $2,452 million.

Key Stats/Developments to Note

Air Products expects earnings from continuing operations for fourth-quarter fiscal 2016 to be in the range of $1.91 to $2.01 per share. The company raised its earnings guidance for fiscal 2016 and now expects it to be in the band of $7.45 to $7.55 per share, up 14% year over year at midpoint of the range.

The company has announced building of a new plant to provide ultra-high purity gases to customers in Nanjing, China. As the company moves closer to the sale of its Performance Materials Division as well as the spin off of its Electronic Materials Division, management expects opportunities to invest in the company’s core industrial gases business for further growth.

Zacks Rank

Currently, Air Products has a Zacks Rank #3 (Hold), but that could change following its earnings report which was just released.

Market Reaction

Air Products’ shares were inactive in pre-market trading. It would be interesting to see how the market reacts to the results during the trading session today.

Check back later for our full write up on Air Products’ earnings report! 

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