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Air Products and Chemicals, Inc. Message Board

  • bendyhickerston bendyhickerston Oct 21, 2011 4:00 PM Flag

    Adios, Air Products.

    I invested in this company in September last year thinking this was a solid play for my Roth IRA. So for the past 12 months this is what I have witnessed:

    -Trailing twelve months share price of Air Products DOWN 3.4%, down maybe 1% net dividends.
    -Trailing twelve months share price of Praxair UP down 12.1%
    -APD's Market Cap DOWN huge today (-$700 million), whereas the general market is UP huge 2%...
    -Air Products forecast 13% earnings DECREASE for Q1 2012 - so much for reading about the company's years long refocus on non-cyclicality!!!
    -Air Products fwd p/e multiple one of the lowest in its history at 14.5; A quick view of its competitors shows Praxair fwd p/e multiple 20, Air Liquide at 18. So the implied value for Air Products earnings is just 70% of its main competitor. This gap has only widened since I've owned the stock.
    -Air Products fwd growth rate 30% lower than Praxair's growth rate at just 9%.
    -Air Products failed takeover of Airgas: waste of company's time, resources, $millions in legal costs, not to mention the bid offer for Airgas was many multiples HIGHER than what Air Products sold their cylinder business to Airgas just a few years ago. This indicates managerial incompetence both then and now -- no reason to think this will change.
    -Air Products buying back $1B of its stock. So, is it that they cannot find better growth opportunities to invest in within the global marketplace (Brazil!?)

    What is standing in the way of this company's growth when its peers seem to have no trouble replicating double digit growth year after year?
    Who gets held accountable for this? Where is the CEO and the board, and why aren't these people should be falling on their proverbial swords?

    You know what, rather than spend any more time on these questions, I'm moving my money where it should have been all along. Taking my loss in Air Products today and buying Praxair.

    Happy trails, APD!

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    • you sort of made a case that APD is the better value and then decided to buy the more expensive competitor.

      APD is the most rock solid dividend aristocrat there is. I LOVE it when this stock drops so I get to add more. My dividend YOB for the past 10 years is great compared to any other investment I have.

      and that includes the 2008 years.

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