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Here's What Makes APD Stock an Attractive Investment Option Now
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Key Takeaways
APD's projects, pricing actions and productivity efforts are expected to support earnings and margins.
Air Products raised fiscal 2026 adjusted earnings guidance to $13.39-$13.49 per share.
APD's fiscal 2026 and 2027 earnings estimates rose 1.8% and 1.5%, respectively, over 60 days.
Air Products and Chemicals, Inc. (APD - Free Report) is well-positioned to benefit from its investments in high-return industrial gas projects, strategic acquisitions and productivity measures.
We are positive about APD’s prospects and believe that the time is right for you to add the stock to the portfolio, as it looks promising and is poised to carry the momentum ahead.
Let’s take a look at the factors that make APD stock a compelling choice for investors right now.
Positive Analyst Sentiment for APD Stock
Earnings estimates for APD have risen over the past 60 days. The Zacks Consensus Estimate for fiscal 2026 has increased by 1.8%. The consensus estimate for fiscal 2027 has also been revised 1.5% upward over the same time frame. The favorable estimate revisions instill investor confidence in the stock.
The Zacks Consensus Estimate for APD’s fiscal 2026 earnings is pegged at $13.46, suggesting an 11.9% increase from the previous year’s tally. Earnings are projected to increase by 7.2% in fiscal 2027.
Image Source: Zacks Investment Research
APD’s Positive Earnings Surprise History
Air Products has outpaced the Zacks Consensus Estimate in three of the trailing four quarters. In this time frame, it has delivered an earnings surprise of roughly 2.9%, on average.
APD’s Superior Return on Equity (ROE)
ROE is a measure of a company’s efficiency in utilizing shareholders’ funds. ROE for the trailing 12-months for Air Products is 16.9%, above the industry’s level of 7.6%.
Image Source: Zacks Investment Research
Air Products’ Upbeat Outlook
Air Products raised its fiscal 2026 adjusted earnings guidance to $13.39-$13.49 per share from the prior range of $13.00-$13.25. For the fourth quarter of fiscal 2026, Air Products expects adjusted earnings of $3.55-$3.65 per share, implying 5-8% growth from the prior-year period. The growth is expected to be supported by new asset contributions, pricing actions and productivity initiatives.
APD Gains on High-Return Projects & Productivity Actions
Air Products is benefiting from investments in high-return projects, new business deals, acquisitions and productivity initiatives. It remains focused on its gasification strategy and is executing its key growth projects. These projects are expected to be accretive to earnings and cash flows.
The company has an industrial gas backlog of roughly $3 billion in projects, mainly supporting electronics customers. It plans to invest about $1.5 billion annually in traditional industrial gas projects.
Air Products is currently pursuing the NEOM green hydrogen project in Saudi Arabia. The project is expected to supply up to 1.2 million tons per year of renewable ammonia. Air Products and Yara International have finalized a marketing and distribution agreement for renewable ammonia from the project. Under the deal, Yara will transport and market green ammonia not sold by Air Products as renewable hydrogen.
Air Products is also driving productivity to improve its cost structure. It is seeing the positive impacts of its productivity actions. Benefits from additional productivity and cost improvement programs are likely to support its margins moving ahead. The company also remains focused on improving pricing amid an inflationary environment. Air Products is also taking action to right-size the organization through headcount reductions and expects these reductions to result in $250 million in annual cost savings once completed. It has already realized roughly $75 million in savings from headcount reductions, as divulged in its fiscal third-quarter earnings call.
Air Products and Chemicals, Inc. Price and Consensus
The Zacks Consensus Estimate for IPI’s current-year earnings stands at $1.86 per share, implying a 29.2% year-over-year increase. Its earnings beat the Zacks Consensus Estimate in three of the trailing four quarters and missed once, with the average surprise being 37.4%.
The Zacks Consensus Estimate for IOSP’s current-year earnings has increased by 3.9% over the past 60 days. Its earnings beat the Zacks Consensus Estimate in all of the trailing four quarters, with the average surprise being 12.9%.
The Zacks Consensus Estimate for AVNT’s current-year earnings is pegged at $3.2 per share, indicating a 13.5% year-over-year increase. Its earnings beat the Zacks Consensus Estimate in all of the trailing four quarters, with the average surprise being 3.4%.
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Here's What Makes APD Stock an Attractive Investment Option Now
Key Takeaways
Air Products and Chemicals, Inc. (APD - Free Report) is well-positioned to benefit from its investments in high-return industrial gas projects, strategic acquisitions and productivity measures.
We are positive about APD’s prospects and believe that the time is right for you to add the stock to the portfolio, as it looks promising and is poised to carry the momentum ahead.
Let’s take a look at the factors that make APD stock a compelling choice for investors right now.
Positive Analyst Sentiment for APD Stock
Earnings estimates for APD have risen over the past 60 days. The Zacks Consensus Estimate for fiscal 2026 has increased by 1.8%. The consensus estimate for fiscal 2027 has also been revised 1.5% upward over the same time frame. The favorable estimate revisions instill investor confidence in the stock.
The Zacks Consensus Estimate for APD’s fiscal 2026 earnings is pegged at $13.46, suggesting an 11.9% increase from the previous year’s tally. Earnings are projected to increase by 7.2% in fiscal 2027.
Image Source: Zacks Investment Research
APD’s Positive Earnings Surprise History
Air Products has outpaced the Zacks Consensus Estimate in three of the trailing four quarters. In this time frame, it has delivered an earnings surprise of roughly 2.9%, on average.
APD’s Superior Return on Equity (ROE)
ROE is a measure of a company’s efficiency in utilizing shareholders’ funds. ROE for the trailing 12-months for Air Products is 16.9%, above the industry’s level of 7.6%.
Image Source: Zacks Investment Research
Air Products’ Upbeat Outlook
Air Products raised its fiscal 2026 adjusted earnings guidance to $13.39-$13.49 per share from the prior range of $13.00-$13.25. For the fourth quarter of fiscal 2026, Air Products expects adjusted earnings of $3.55-$3.65 per share, implying 5-8% growth from the prior-year period. The growth is expected to be supported by new asset contributions, pricing actions and productivity initiatives.
APD Gains on High-Return Projects & Productivity Actions
Air Products is benefiting from investments in high-return projects, new business deals, acquisitions and productivity initiatives. It remains focused on its gasification strategy and is executing its key growth projects. These projects are expected to be accretive to earnings and cash flows.
The company has an industrial gas backlog of roughly $3 billion in projects, mainly supporting electronics customers. It plans to invest about $1.5 billion annually in traditional industrial gas projects.
Air Products is currently pursuing the NEOM green hydrogen project in Saudi Arabia. The project is expected to supply up to 1.2 million tons per year of renewable ammonia. Air Products and Yara International have finalized a marketing and distribution agreement for renewable ammonia from the project. Under the deal, Yara will transport and market green ammonia not sold by Air Products as renewable hydrogen.
Air Products is also driving productivity to improve its cost structure. It is seeing the positive impacts of its productivity actions. Benefits from additional productivity and cost improvement programs are likely to support its margins moving ahead. The company also remains focused on improving pricing amid an inflationary environment. Air Products is also taking action to right-size the organization through headcount reductions and expects these reductions to result in $250 million in annual cost savings once completed. It has already realized roughly $75 million in savings from headcount reductions, as divulged in its fiscal third-quarter earnings call.
Air Products and Chemicals, Inc. Price and Consensus
Air Products and Chemicals, Inc. price-consensus-chart | Air Products and Chemicals, Inc. Quote
APD’s Zacks Rank & Key Picks
APD currently carries a Zacks Rank #2 (Buy).
Other top-ranked stocks in the Basic Materials space are Intrepid Potash, Inc. (IPI - Free Report) , Innospec Inc. (IOSP - Free Report) and Avient Corporation (AVNT - Free Report) . IPI currently carries a Zacks Rank #1 (Strong Buy), while IOSP and AVNT carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for IPI’s current-year earnings stands at $1.86 per share, implying a 29.2% year-over-year increase. Its earnings beat the Zacks Consensus Estimate in three of the trailing four quarters and missed once, with the average surprise being 37.4%.
The Zacks Consensus Estimate for IOSP’s current-year earnings has increased by 3.9% over the past 60 days. Its earnings beat the Zacks Consensus Estimate in all of the trailing four quarters, with the average surprise being 12.9%.
The Zacks Consensus Estimate for AVNT’s current-year earnings is pegged at $3.2 per share, indicating a 13.5% year-over-year increase. Its earnings beat the Zacks Consensus Estimate in all of the trailing four quarters, with the average surprise being 3.4%.