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1. Company Snapshot

1.a. Company Description

PPG Industries, Inc.manufactures and distributes paints, coatings, and specialty materials worldwide.The company's Performance Coatings segment offers coatings, solvents, adhesives, sealants, sundries, and software for automotive and commercial transport/fleet repair and refurbishing, light industrial coatings, and specialty coatings for signs; and coatings, sealants, transparencies, transparent armor, adhesives, engineered materials, and packaging and chemical management services for commercial, military, regional jet, and general aviation aircraft.


It also provides coatings and finishes for the protection of metals and structures, such as metal fabricators, heavy duty maintenance contractors, and manufacturers of ships, bridges, and rail cars; paints, wood stains, adhesives, and purchased sundries for painting and maintenance contractors, and consumers for decoration and maintenance of residential and commercial building structures; and paints, thermoplastics, pavement marking products, and other technologies for pavement marking.The company's Industrial Coatings segment offers coatings, adhesives and sealants, and metal pretreatments, as well as services and coatings applications for appliances, agricultural and construction equipment, consumer electronics, automotive parts and accessories, building products, kitchenware, and transportation vehicles and other finished products; and on-site coatings services.It also provides coatings for metal cans, closures, plastic tubes, and promotional and specialty packaging; amorphous precipitated silica for tire, battery separator, and other end-uses; TESLIN substrates for labels, e-passports, drivers' licenses, breathable membranes, and loyalty and identification cards; and organic light emitting diode materials, displays and lighting lens materials, optical lenses, color-change products, and photochromic dyes.


The company was incorporated in 1883 and is headquartered in Pittsburgh, Pennsylvania.

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1.b. Last Insights on PPG

PPG Industries' recent performance was driven by a 5% increase in quarterly revenue to $3.91 billion, primarily due to higher prices and volume. The company's net sales growth of 2% organically and a strong cash flow of $1.9 billion, up about $500 million year-over-year, demonstrate its resilience amidst challenges. Additionally, PPG's market share gains, pricing power, and AI-driven product innovation underpin medium-term growth, particularly in aerospace and architectural coatings. The company's strong BBB+ balance sheet, 53-year dividend growth streak, and active buybacks further support its growth prospects.

1.c. Company Highlights

2. PPG Industries' 2025 Earnings Report: A Strong Finish with Growth Momentum

PPG Industries reported net sales of $15.9 billion for the full year 2025, with 2% organic growth driven by higher selling prices and volume gains. Adjusted EPS was $7.58, and cash from operations totaled $1.9 billion, up about $0.5 billion year over year. In Q4 2025, net sales were $3.9 billion, up 5% year over year, with 3% organic growth driven by positive sales volume growth across all regions. The actual EPS for Q4 came out at $1.51, slightly below estimates of $1.57.

Publication Date: Feb -02

📋 Highlights
  • 2025 Financial Performance:: Net sales reached $15.9 billion with 2% organic growth, adjusted EPS at $7.58, and operating cash flow of $1.9 billion (up $500M YoY).
  • Q4 2025 Growth Drivers:: $3.9 billion in sales (+5% YoY), 3% organic growth from volume gains across all regions, with aerospace contributing double-digit sales growth.
  • Shareholder Returns:: $1.4 billion returned via dividends ($630M) and buybacks ($790M), equivalent to 3% of outstanding shares, ending 2025 with $2.2 billion in cash.
  • Aerospace Expansion:: $380 million allocated for a new facility and $120 million for debottlenecking, targeting high single-digit growth in 2026 despite capacity constraints.
  • 2026 Guidance:: EPS growth expected at mid-single-digit midpoint, with H2 growth accelerating to high single digits, driven by price gains in architectural coatings and share gains in industrial markets.

Segment Performance

The company's aerospace segment saw double-digit sales growth in 2025, with high single-digit growth expected in 2026, despite capacity constraints. The refinish business is seeing "green shoots" with market share momentum, particularly in the US and Europe, and new digital tools are being well-received. Architectural EME, a business that has struggled to grow, is expected to see flat volume in 2026, but the company is taking actions to see margin expansion and cash generation expansion.

Guidance and Outlook

The company expects organic sales growth in the range of flat to positive low single-digit percentage in 2026, driven by aerospace, architectural coatings in Mexico, and about $100 million of share gains in the industrial coatings segment. They anticipate positive price for the company, with strength from performance and architectural coating segments, partially offset by modest contraction in the industrial coating segment. Earnings per share growth is expected to represent a mid-single-digit percentage increase, with growth in the second half of the year expected to be high single-digit percentage.

Valuation and Returns

With a P/E Ratio of 16.46 and an EV/EBITDA of 11.1, the company's valuation appears reasonable. The Dividend Yield is 2.4%, and the Free Cash Flow Yield is 2.79%. The company's ROIC is 40.14%, and ROE is 33.6%, indicating strong profitability. The Net Debt / EBITDA ratio is 1.88, indicating a manageable debt position. Analysts estimate next year's revenue growth at 2.8%.

Operational Highlights

The company has launched its first AI-formulated product in refinish and has used AI to optimize 50 existing products. This technology is expected to drive productivity savings and is a differentiator for the company. The company has also invested $120 million in incremental CapEx for debottlenecking and announced a $380 million new facility. Operating leverage is impacted by refinish destocking, but they expect to see leverage from incremental volume growth, pricing, and cost actions.

3. NewsRoom

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PPG Industries: Buy This Dividend Aristocrat At Below Average Price

Feb -02

Source: seekingalpha.com

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PPG global leaders transform Kids in Distress campus in Florida with COLORFUL COMMUNITIES project

Feb -02

Source: businesswire.com

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PPG introduces PPG STEELGUARD 652 coating for interior structural steel

Feb -02

Source: businesswire.com

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Federated Hermes Inc. Has $12.23 Million Position in PPG Industries, Inc. $PPG

Feb -01

Source: defenseworld.net

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PPG partners with Dubai's Jebel Ali Free Zone on tree-planting initiative

Jan -30

Source: businesswire.com

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10 Highest Rated Dividend Kings For Generations Of Income

Jan -29

Source: seekingalpha.com

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PPG Industries Inc (PPG) Q4 2025 Earnings Call Highlights: Strong Cash Flow and Resilient Growth Amidst Challenges

Jan -28

Source: gurufocus.com

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PPG Industries, Inc. (PPG) Q4 2025 Earnings Call Transcript

Jan -28

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.23%)

6. Segments

Performance Coatings

Expected Growth: 2.5%

PPG Industries' Performance Coatings segment growth of 2.5% is driven by increasing demand for automotive refinish coatings, growth in the aerospace market, and expansion in emerging markets. Additionally, the company's focus on innovative products, such as its B1:B2 paint system, and strategic acquisitions are contributing to the segment's growth.

Industrial Coatings

Expected Growth: 1.8%

PPG Industries' Industrial Coatings segment growth of 1.8% is driven by increasing demand from the automotive and aerospace industries, as well as growing adoption of sustainable and eco-friendly coatings. Additionally, the company's strategic acquisitions and investments in emerging markets, such as Asia and Latin America, are contributing to its growth.

7. Detailed Products

Coatings

PPG Industries offers a wide range of coatings for various industries, including automotive, industrial, and architectural markets.

Optical Products

PPG Industries provides optical products, including sunglasses, goggles, and lenses, for various industries, including aerospace, automotive, and sports.

Specialty Materials

PPG Industries offers specialty materials, including silica, silicates, and zeolites, for various industries, including construction, consumer goods, and pharmaceuticals.

Composites

PPG Industries provides composite materials, including fiberglass, carbon fiber, and hybrid materials, for various industries, including aerospace, automotive, and industrial markets.

Silicas

PPG Industries offers silicas, including precipitated silica and silica gel, for various industries, including construction, consumer goods, and pharmaceuticals.

8. PPG Industries, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for PPG Industries, Inc. is medium due to the availability of alternative products and services in the coatings and specialty materials industry.

Bargaining Power Of Customers

The bargaining power of customers for PPG Industries, Inc. is low due to the company's strong brand reputation and diversified customer base.

Bargaining Power Of Suppliers

The bargaining power of suppliers for PPG Industries, Inc. is medium due to the presence of multiple suppliers in the market, but the company's large scale of operations gives it some bargaining power.

Threat Of New Entrants

The threat of new entrants for PPG Industries, Inc. is low due to the high barriers to entry in the coatings and specialty materials industry, including significant capital requirements and regulatory hurdles.

Intensity Of Rivalry

The intensity of rivalry for PPG Industries, Inc. is high due to the presence of several established players in the coatings and specialty materials industry, leading to intense competition for market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 44.35%
Debt Cost 4.80%
Equity Weight 55.65%
Equity Cost 10.40%
WACC 7.92%
Leverage 79.70%

11. Quality Control: PPG Industries, Inc. passed 6 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Ecolab

A-Score: 5.2/10

Value: 1.2

Growth: 5.1

Quality: 6.2

Yield: 2.0

Momentum: 7.0

Volatility: 10.0

1-Year Total Return ->

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Stock-Card
PPG

A-Score: 5.0/10

Value: 4.0

Growth: 2.8

Quality: 6.5

Yield: 5.0

Momentum: 3.0

Volatility: 8.7

1-Year Total Return ->

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Sherwin-Williams

A-Score: 4.9/10

Value: 1.7

Growth: 6.4

Quality: 6.0

Yield: 2.0

Momentum: 4.0

Volatility: 9.3

1-Year Total Return ->

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Air Products

A-Score: 4.4/10

Value: 4.8

Growth: 2.9

Quality: 2.1

Yield: 6.0

Momentum: 2.5

Volatility: 8.3

1-Year Total Return ->

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IFF

A-Score: 4.4/10

Value: 5.4

Growth: 2.3

Quality: 3.1

Yield: 6.0

Momentum: 2.0

Volatility: 7.7

1-Year Total Return ->

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DuPont

A-Score: 3.5/10

Value: 6.9

Growth: 3.7

Quality: 3.7

Yield: 4.0

Momentum: 0.5

Volatility: 2.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

116.46$

Current Price

116.46$

Potential

-0.00%

Expected Cash-Flows