Unstoppable PPG Industries: Analyst Forecasts Margin Comeback, Price Boost, And Market Domination

Mizuho analyst Christopher Parkinson keeps Buy rating on PPG Industries, Inc. PPG, raising the price target to $152 from $151.
The analyst notes that PPG is confident in building a solid price/cost momentum, followed by an eventual restoration of margins (steady multi-yr bridge to the prior peak).
Auto OEM results are also tracking well as PPG is outperforming build rates (customer wins, particularly in Europe), the analyst notes.
The analyst also retains a constructive view on the Refinish platform, driven by new business wins, growing backlogs and strong value proposition).
These apart, the analyst expects pricing to be moderate throughout the year, though management appears fully confident it will retain "positive price."
PPG assumes modest deflation in 2Q, which remains the most powerful profit lever to which investors are beginning to ascribe more credit.
Further, PPG is reaching an inflection point on margins as carryover pricing (+ increases in PC), manufacturing efficiency (healthier supply chains), mix enrichment (Aero, Refinish) and raw material neutralization (morphs to firm tailwind in 2Q/2H) flow through results.
Price Action: PPG shares are trading higher by 0.27% at $142.37 on the last check Monday.

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