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Reading PPG Industries' 3Q17 Pre-Earnings Expectations

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Reading PPG Industries' 3Q17 Pre-Earnings Expectations PART 1 OF 5

Inside PPG Industries’ Stock Performance in 2017 before Its 3Q17 Results

PPG Industries to announce its 3Q17 earnings

On September 29, 2017, PPG Industries (PPG) stated that it would announce its 3Q17 earnings on October 19, 2017, before the market opens. PPG will hold a teleconference the same day at 2:00 PM EST.

In this series, we’ll take a look at PPG’s stock performance so far in 2017. We’ll also look at the analysts’ revenue and EPS (earnings per share) estimates for 3Q17, the latest analyst recommendations, and the company’s valuation.

Inside PPG Industries&#8217; Stock Performance in 2017 before Its 3Q17 Results

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PPG’s stock performance in 2017

On a YTD (year-to-date) basis, PPG has returned 18.6%, outperforming the broad-based SPDR S&P 500 ETF (SPY). PPG also outperformed peers RPM International (RPM) and Axalta (AXTA), which have returned -4.3% and 5.0%, respectively. However, PPG has underperformed Sherwin-Williams (SHW), which has returned 42.5% during the same period.

PPG’s strong growth in stock price was driven by good 1Q17 earnings but offset by lower-than-expected 2Q17 earnings. However, share repurchases, new business deals, and capacity expansions in Russia have all driven the stock price positively.

Meanwhile, PPG’s exit from its glass business to focus on paintings and coatings—followed by its acquisition of Crown Group and its financial commitment of $2.5 billion to $3.5 billion for acquisitions and share repurchases—also reflect PPG’s strategy to drive the future growth.

PPG stock has largely traded above its 100-day moving average price in 2017, except after the announcement of its 2Q17 earnings. But the stock has recovered and is now trading 4.3% above the 100-day moving average price of $107.84, reflecting an upward trend in the stock. PPG’s 14-day relative strength index level indicates that the stock is neither overbought nor oversold.

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