PPG Industries (PPG - Free Report) intends to open a new distribution center in Flower Mound, TX. The roughly 450,000-square-foot facility will be build and leased through Duke Realty DRE. Touted to be the largest distribution center for architectural paints and coatings in the company’s U.S. and Canada network, the project is expected to be completed in May 2019.
With this move, the company will be able to strengthen its distribution model and provide improved and efficient service to national accounts, company stores and independent retailers across the United States.
The new center will help expand the company’s presence in the Dallas-Fort Worth area. PPG Industries has already invested around $9 million to open 14 stores, bringing the total to nearly 40 PPG stores in the region.
The company’s shares have declined around 1.4% over a year compared with roughly 15% growth recorded by its industry.
PPG Industries sees positive momentum in overall economic growth. The company is on track with its restructuring actions that are expected to provide cost savings between $50 million and $55 million in 2018, higher than what it had expected earlier.
However, PPG Industries is exposed to raw materials cost pressure that is affecting margins. The trend is expected to continue through the second quarter. Moreover, some of its end markets including wood and marine still remain sluggish.
PPG Industries, Inc. Price and Consensus
Zacks Rank & Stocks to Consider
PPG Industries currently carries a Zacks Rank #4 (Sell).
Some better-ranked companies in the basic materials space are FMC Corp. (FMC - Free Report) , Celanese Corp. (CE - Free Report) and The Chemours Co. (CC - Free Report) . All three stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
FMC Corp has an expected long-term earnings growth rate of 16.4%. Its shares have gained around 19.3% over a year.
Celanese has an expected long-term earnings growth rate of 8.9%. Its shares have moved up around 33.7% over a year.
Chemours has an expected long-term earnings growth rate of 15.5%. Its shares have gained around 30.1% over a year.
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