PPG Reaches Agreement to Divest Certain Business Operations in Africa

PPG Industries, Inc. PPG has agreed to sell certain business operations in Senegal, Ivory Coast, Cameroon, Gabon and Algeria to Oceinde, an industrial group based in Reunion, France.

Oceinde will continue to supply the current range of products, including Seigneurie paint, through a license and distribution agreement. It has several business activities in Europe, the Indian Ocean and Africa such as the distribution and manufacture of architectural coatings.

This alliance will strengthen the relationship between the companies, which includes the supply of specialty materials from Oceinde to PPG. PPG employees from the respective countries will join Oceinde. Olivier Bouin, current managing director of PPG, Architectural Coatings Africa French Overseas and Suriname, will join Oceinde as managing director of the Trade Architectural Coatings market in Africa.

PPG Industries said this change in business model will benefit its customers in Africa. The two companies are working together to better serve the African market.

Shares of the company are down 10.5% in the past year against a 3.3% rise in the industry.

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The company, in its latest earnings call, said while it expects demand to remain strong, it fears supply and pandemic-related disruptions in the fourth quarter will continue into the first quarter of 2022. , hampering the manufacture and delivery of products. He also expects raw material cost inflation as well as rising logistics and labor costs to persist. PPG Industries is taking steps to raise selling prices to offset the additional inflation.

PPG Industries expects earnings per share (EPS) of between 84 cents and $1.02 for the first quarter of 2022. Adjusted EPS is expected to be between $1.02 and $1.20, excluding amortization expense of 14 cents and previously disclosed business restructuring costs of 4 cents.

The company expects aggregate net sales volumes to be down mid-single digit percentage on an annual basis for the first quarter of 2022.

PPG Industries, Inc. Pricing and Consensus

PPG Industries, Inc. Pricing and Consensus

PPG Industries, Inc. price consensus chart | Quote from PPG Industries, Inc.

Zacks ranking and key picks

PPG Industries currently carries a Zacks rank #3 (Hold).

Some top-ranked stocks in the base materials space are The Mosaic Company MOS, AdvanSix Inc. ASIX and Allegheny Technologies Incorporated ATI.

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Mosaic’s earnings have topped the Zacks consensus estimate in three of the past four quarters while missing once. It generated an earnings surprise for the last four quarters of around 3.7% on average. MOS is up around 119.9% ​​in one year and currently sports a Zacks rank of #1 (Strong Buy). You can see the full list of today’s Zacks #1 Rank stocks here.

AdvanSix forecasts a profit growth rate of 64.8% for the current year. The Zacks consensus estimate for ASIX earnings for the current year has been revised up 58% in the past 60 days.

AdvanSix’s earnings have exceeded the Zacks consensus estimate in three of the past four quarters, averaging 23.6%. ASIX jumped 83.9% in one year. The company sports a No. 1 Zacks rank.

Allegheny, which currently sports a No. 1 Zacks rank, has an expected earnings growth rate of 684.6% for the current year. The Zacks consensus estimate for ATI’s earnings for the current year has been revised up 20% in the past 60 days.

Allegheny’s earnings have exceeded the Zacks consensus estimate in each of the past four quarters, averaging 127.2%. ATI rebounded around 23.8% year-on-year.

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