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PPG Industries Inc. (PPG - Free Report) logged net income from continuing operations of $366 million or $1.54 per share in third-quarter 2019 compared with $368 million or $1.51 per share in the year-ago quarter.
Barring one-time items, adjusted earnings per share (EPS) were $1.67, up from $1.45 in the prior-year quarter. The figure beat the Zacks Consensus Estimate of $1.61.
Net sales edged up around 0.2% year over year to $3,826 million in the reported quarter. However, the figure missed the Zacks Consensus Estimate of $3,896.7 million. Unfavorable currency swings affected net sales by around 2% while acquisition-related sales, net of divestitures, contributed more than 2% to sales growth and higher selling prices contributed 2.6%.
PPG Industries, Inc. Price, Consensus and EPS Surprise
Performance Coatings: Net sales in the segment amounted to roughly $2.3 billion in the third quarter, up around 1% year over year. Sales volume in the segment was relatively flat year over year. Unfavorable foreign currency translation reduced net sales by roughly 2%.
Segment income rose roughly 15% year over year to $380 million. The figure benefitted from higher selling prices, cost management and restructuring initiatives of the company.
Industrial Coatings: Sales in the segment totaled $1.5 billion, down nearly 1% from the prior-year quarter’s figure. Increased selling prices of 2% and acquisition-related sales of around $80 million were offset by lower sales volumes of 6%. Also, unfavorable foreign currency translation lowered sales by nearly 2% on a year-over-year basis.
Net income in the segment totaled $205 million, up around 22% year over year. Improving selling prices, acquisition-related income and strong cost management actions were partly offset by reduced sales volumes. Unfavorable currency impact was around $3 million.
Financial Position
PPG Industries ended the quarter with cash and cash equivalents of $1.4 billion, up around 29.8% year over year. Long-term debt fell around 2.7% year over year to $4,885 million.
Outlook
Going forward, PPG Industries expects global economic growth to remain soft in the fourth quarter and impact several end-use markets.
For 2019, the company expects adjusted EPS in the range of $6.17-$6.27. The projection includes fourth quarter year-over-year growth in constant currencies of around 15% at the mid-point. Moreover, the guidance represents adjusted EPS growth at the low-to-mid end of earlier announced 7-10% range, excluding currency translation impacts.
The company expects full-year sales growth of a low-single-digit percentage, which excludes currency-translation impacts.
Price Performance
Shares of PPG Industries have gained 21.3% in the past year against 31.6% decline of the industry.
Zacks Rank & Key Picks
PPG Industries currently carries a Zacks Rank #3 (Hold).
Kinross has an expected earnings growth rate of 170% for 2019. The company’s shares have surged 61.9% in the past year.
Franco-Nevada has a projected earnings growth rate of 34.9% for 2019. The company’s shares have rallied 40.3% in a year’s time.
Agnico Eagle has an estimated earnings growth rate of 158.6% for the current year. Its shares have moved up 42.2% in the past year.
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PPG Industries (PPG) Q3 Earnings Beat, Sales Trail Estimates
PPG Industries Inc. (PPG - Free Report) logged net income from continuing operations of $366 million or $1.54 per share in third-quarter 2019 compared with $368 million or $1.51 per share in the year-ago quarter.
Barring one-time items, adjusted earnings per share (EPS) were $1.67, up from $1.45 in the prior-year quarter. The figure beat the Zacks Consensus Estimate of $1.61.
Net sales edged up around 0.2% year over year to $3,826 million in the reported quarter. However, the figure missed the Zacks Consensus Estimate of $3,896.7 million. Unfavorable currency swings affected net sales by around 2% while acquisition-related sales, net of divestitures, contributed more than 2% to sales growth and higher selling prices contributed 2.6%.
PPG Industries, Inc. Price, Consensus and EPS Surprise
PPG Industries, Inc. price-consensus-eps-surprise-chart | PPG Industries, Inc. Quote
Segment Highlights
Performance Coatings: Net sales in the segment amounted to roughly $2.3 billion in the third quarter, up around 1% year over year. Sales volume in the segment was relatively flat year over year. Unfavorable foreign currency translation reduced net sales by roughly 2%.
Segment income rose roughly 15% year over year to $380 million. The figure benefitted from higher selling prices, cost management and restructuring initiatives of the company.
Industrial Coatings: Sales in the segment totaled $1.5 billion, down nearly 1% from the prior-year quarter’s figure. Increased selling prices of 2% and acquisition-related sales of around $80 million were offset by lower sales volumes of 6%. Also, unfavorable foreign currency translation lowered sales by nearly 2% on a year-over-year basis.
Net income in the segment totaled $205 million, up around 22% year over year. Improving selling prices, acquisition-related income and strong cost management actions were partly offset by reduced sales volumes. Unfavorable currency impact was around $3 million.
Financial Position
PPG Industries ended the quarter with cash and cash equivalents of $1.4 billion, up around 29.8% year over year. Long-term debt fell around 2.7% year over year to $4,885 million.
Outlook
Going forward, PPG Industries expects global economic growth to remain soft in the fourth quarter and impact several end-use markets.
For 2019, the company expects adjusted EPS in the range of $6.17-$6.27. The projection includes fourth quarter year-over-year growth in constant currencies of around 15% at the mid-point. Moreover, the guidance represents adjusted EPS growth at the low-to-mid end of earlier announced 7-10% range, excluding currency translation impacts.
The company expects full-year sales growth of a low-single-digit percentage, which excludes currency-translation impacts.
Price Performance
Shares of PPG Industries have gained 21.3% in the past year against 31.6% decline of the industry.
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) , Franco-Nevada Corporation (FNV - Free Report) and Agnico Eagle Mines Limited (AEM - Free Report) , each 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 170% for 2019. The company’s shares have surged 61.9% in the past year.
Franco-Nevada has a projected earnings growth rate of 34.9% for 2019. The company’s shares have rallied 40.3% in a year’s time.
Agnico Eagle has an estimated earnings growth rate of 158.6% for the current year. Its shares have moved up 42.2% in the past year.
7 Best Stocks for the Next 30 Days
Just released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers “Most Likely for Early Price Pops.”
Since 1988, the full list has beaten the market more than 2X over with an average gain of +24.50% per year. So be sure to give these hand-picked 7 your immediate attention.
See them now >>