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Air Products (APD) to Showcase New Mobile Nitrogen Pumpers

Zacks Equity Research

Air Products APD declared that it will highlight its new mobile nitrogen pumpers at the Pipeline Pigging & Integrity Management Conference (PPIM) in Houston. Part of Air Products Express Services (“APEX”), the new pumpers feature advanced technology that promotes safety and reliability as well as complies with the forthcoming air regulations to meet the rising demands in refinery, petrochemical, and pipeline operations.

The new pumpers are instrumental in preventing troublesome breaks. This in turn will improve the reliability of these pumpers and will provide high level personnel protection. The pumpers are equipped with climate-controlled cabins which help in reducing operator fatigue along with a configuration that lower operator exposure to noise and weather conditions.

APEX provides short-term and emergency nitrogen needs. This economical option for high-quality nitrogen supply can be used for various purposes such as purging, pressure testing or drying piping systems; pipeline commissioning or decommissioning; product displacement; oxygen-freeing; pipeline and water removal and drying following hydrotesting.

Air Products has underperformed the Zacks categorized Chemicals-Diversified industry over the past three months. The company’s shares have gained around 1.3% over this period, compared with roughly 9.3% gain recorded by the industry.



Air Products is well positioned to capitalize on the cyclical recovery in core industrial end-markets. The company has built a strong project backlog. These projects are expected to be accretive to earnings and cash flow over the next few years. Acquisitions and new business wins are expected to continue to drive results in the near term. The company is also progressing well with its $600 million cost-cutting program.

However, Air Product’s industrial gases business in the EMEA region is seeing pressure from a weak operating environment. The company is also seeing lower volumes in Latin America due to weak demand. Moreover, volumes in packaged gases continue to be weak while LNG sales remain under pressure due to low project activity. The company is also exposed to currency headwinds and has a debt-laden balance sheet.

Air Products missed earnings expectations in first-quarter fiscal 2017 (ended Dec 31, 2016). The company logged first-quarter adjusted earnings of $1.47 per share, up 9% from the year-ago quarter. However, earnings missed the Zacks Consensus Estimate of $1.48. Revenues inched up 1% year over year to $1.88 billion in the reported quarter but missed the Zacks Consensus Estimate of $1.96 billion.

For the second quarter of fiscal 2017, Air Products expects adjusted earnings from continuing operations of $1.30 to $1.40 per share. Air Products also expects adjusted earnings for fiscal 2017 in the range of $6.00 to $6.25 per share, up 9% year over year at the midpoint. The company expects capital expenditures of roughly $1 billion in fiscal 2017.

Air Products currently carries a Zacks Rank #4 (Sell).

Air Products and Chemicals, Inc. Price and Consensus

 

Air Products and Chemicals, Inc. Price and Consensus | Air Products and Chemicals, Inc. Quote

Key Picks

Better-ranked companies in the chemical space include The Chemours Company CC, Methanex Corp. MEOH and Albemarle Corp. ALB.

Chemours Company has expected long-term growth of 15.5% and sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Methanex has expected long-term growth of 15% and also flaunts a Zacks Rank #1.

Albemarle has expected long-term growth of 10% and carries a Zacks Rank #2 (Buy).

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