PPG Industries Inc. (PPG - Free Report) announced that it has completed the acquisition of Dexmet Corporation, without disclosing the financial terms of the deal.
Based in Wallingford, CT, Dexmet is a producer of specialty materials for surfaces in automotive, aerospace and industrial applications. It employs around 75 employees and specializes in highly-engineered, customized, expanded and perforated polymers as well as metal foils used in mission-critical applications.
In July, PPG Industries declared that it has reached a definitive agreement with private equity firm Sverica Capital Management LP to acquire Dexmet. The buyout will enable PPG Industries to add value to customers by enhancing product offerings as well as expanding R&D capabilities. It will also increase its market reach across the automotive, aerospace and industrial coatings businesses.
Shares of PPG Industries have inched up 1.1% in the past year against the 42.3% decline of the industry.
PPG Industries’ adjusted earnings per share (EPS) went down 3.7% year over year to $1.85 in the second quarter. Nevertheless, the figure beat the Zacks Consensus Estimate of $1.83.
Net sales were down nearly 3% year over year to $4,024 million in the reported quarter. The figure fell short of the Zacks Consensus Estimate of $4,094.4 million.
The company expects industry demand for several of its businesses to remain sluggish in the third quarter. The company is focused on recovering operating margins and expects the momentum to continue as it works with customers and suppliers to further offset the impact of raw material cost inflation.
The company expects third-quarter EPS in the range of $1.57-$1.67. It also reaffirmed 2019 adjusted EPS growth in the range of 7-10% and envisions sales growth of a low-single-digit percentage for the full year, both excluding currency translation impacts.
The company continues to aggressively manage costs amid a challenging business environment. It delivered roughly $20 million of cost savings in the second quarter. PPG Industries is also committed in its cash deployment with a focus on boosting shareholders’ value in the long term.
Zacks Rank & Key Picks
PPG Industries currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the basic materials space are Kinross Gold Corporation (KGC - Free Report) , Alamos Gold Inc (AGI - Free Report) and Arconic Inc (ARNC - Free Report) , all sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Kinross has an expected earnings growth rate of 140% for 2019. The company’s shares have surged 69.9% in the past year.
Alamos Gold has projected earnings growth rate of 280% for the current year. The company’s shares have rallied 63.9% in a year’s time.
Arconic has an estimated earnings growth rate of 42.7% for the current year. Its shares have moved up 17.7% in the past year.
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