PPG Q2 revenue beats estimates on strength in aerospace, Latin America coatings businesses

Overview

• U.S. paints and coatings maker's Q2 revenue rose 7%, beating analyst expectations

• Adjusted EPS for Q2 missed analyst expectations

• Company repurchased $75 mln in shares during the quarter

Outlook

• PPG reaffirms full-year 2026 adjusted EPS guidance range of $7.70 to $8.10

• Company expects Q3 organic sales growth in low to mid-single-digit percentage range

• PPG sees Q3 adjusted EBITDA margin flat to down 100 basis points year over year

Result Drivers

• AEROSPACE AND LATIN AMERICA STRENGTH - Strong results in differentiated aerospace and Latin American architectural coatings businesses drove organic sales growth, per CEO Tim Knavish

• PRICE INCREASES OFFSET COST INFLATION - Company said 2% selling price increases helped cover about 90% of cost of goods sold inflation in Q2

• WEAKER AUTOMOTIVE REFINISH DEMAND - Lower sales volumes in automotive refinish coatings weighed on Performance Coatings margins

Company press release: ID:nBwc9kWx1a

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 12 "strong buy" or "buy", 14 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the commodity chemicals peer group is "buy"

• Wall Street's median 12-month price target for PPG Industries Inc is $128.50, about 8.5% above its July 27 closing price of $118.47

• The stock recently traded at 14 times the next 12-month earnings vs. a P/E of 13 three months ago

Reuters Recommended Reads

• July 28 - Sherwin-Williams raises profit forecast, expects higher prices to drive growth

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• July 28 - Boeing share price rises despite larger-than-expected Q2 loss from higher Air Force One costs

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)