PPG Industries Inc. (PPG) has finally settled its dispute regarding the clean-up effort in Jersey City, N.J., with two community organizations and a national environmental group.
PPG has agreed to the clean-up one of the largest remaining sites contaminated with cancer-causing hexavalent chromium in New Jersey. The cleanup is estimated to cost the company up to $ 600 million and remove an estimated 700,000 tons of chromium waste from a Jersey City neighborhood. The settlement stems from a citizen lawsuit filed in federal court in 2009 by the Natural Resources Defense Council (NRDC), Interfaith Community Organization (ICO), and GRACO Community Organization (GRACO) on behalf of Jersey City residents, who have been fighting for a comprehensive clean-up since the early 1980s.
Recently, PPG also forecasted its first-quarter 2011 earnings driven by better-than-expected European volumes and expects the trend to continue in the next quarter, allowing the company to raise prices of some products.
For first-quarter 2011, PPG expects earnings to be in the range of $ 1.30 to $ 1.35 per diluted share compared with 69 cents per diluted share and 18 cents per diluted share in the first quarters of 2010 and 2009, respectively.
Looking ahead, the company expects the global economic recovery to strengthen, driving volume increase for PPG, which should leverage into higher earnings through continued cost focus.
Strong fourth-quarter performance along with successful adoption of growth strategies and their meaningful implementation keep us confident on the company. In addition, the macro economy and the concerned industry are also showing signs of recovery.
PPG Industries, however, faces stiff competition from privately held Akzo Nobel N.V and EI DuPont de Nemours & Co. (DD).
PPG Industries has a Zacks #1 Rank (Strong Buy) in the short term and a long-term Neutral recommendation on the stock.
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