PPG Industries Inc. PPG, at a securities analyst meeting held at Cabo San Lucas, Mexico, reviewed PPG-Comex Mexican operations and gave updates about the growth of the Mexican economy and PPG-Comex.
PPG-Comex is PPG Industries’ architectural paint and coatings business in Mexico and Central America. The company completed its $2.3 billion purchase of leading Mexican paint company – Comex – in Nov 2014.
PPG Industries announced that it expects cost synergies from the Comex acquisition to be in the range of $45 million to $50 million by the end of 2016, an increase from the previous expectation of $30 million to $40 million. Through PPG-Comex distribution network, the company expects to generate $40 million to $50 million in revenues within two years from sales of PPG products.
PPG Industries also unveiled a revenue goal of $60 million to $70 million within five years for incremental coatings sales in Central America. The company had earlier issued no incremental revenue guidance relating to Comex.
The company’s share price rose 1.3% in the trading session last Thursday. The stock closed the day around 1% higher at $117.81.
PPG Industries has a diversified business and a leading position in several paints and coatings end markets. Healthy momentum across automotive OEM, automotive refinish and aerospace markets is expected to support its results this year. PPG Industries should also continue to gain from acquisitions.
Recently, PPG Industries agreed to buy privately-owned specialty powder and liquid coating maker – IVC Industrial Coatings, Inc. – for an undisclosed price. The deal, which is subject to customary closing conditions, is expected to close in the third quarter of 2015.
PPG Industries currently holds a Zacks Rank #3 (Hold).
Better-ranked stocks in the chemical space include Stepan Company SCL, LyondellBasell Industries N.V. LYB and L'Air Liquide SA AIQUY, all carrying a Zacks Rank #1 (Strong Buy).
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