|Bid||0.00 x 800|
|Ask||0.00 x 1100|
|Day's Range||89.99 - 90.83|
|52 Week Range||78.44 - 104.80|
|PE Ratio (TTM)||N/A|
|Beta (3Y Monthly)||1.03|
|Expense Ratio (net)||0.43%|
Basic materials is one of the weakest sectors this reporting cycle. But, it was unable to take the sheen away from material ETFs that are up nearly 1% over the past week.
DowDuPont Feels the Currency Heat in Q4—Down More than 8% TodayDowDuPont’s fourth-quarter resultsDowDuPont (DWDP) announced its fourth-quarter earnings results on January 31, 2019. The company reported revenue of ~$20.10 billion, indicating that
DowDuPont's Q4 Earnings: What Investors Can ExpectDowDuPont’s fourth-quarter revenue estimatesDowDuPont (DWDP) is expected to report revenues of $20.92 billion in the fourth quarter—an increase of ~4.3% compared to the revenues in the fourth
PPG Industries' Q4 Earnings Beat the Street—Stock Rises(Continued from Prior Part)PPG’s fourth-quarter revenue misses estimates marginally For the fourth quarter, PPG Industries (PPG) reported revenue of $3.64 billion, a fall of 1.0% YoY
PPG Industries: What to Expect from Its Q4 Earnings(Continued from Prior Part)Adjusted EPS forecastWall Street analysts expect PPG Industries (PPG) to post an adjusted EPS of $1.10 for the fourth quarter, which reflects a decline of 7.6% YoY
Specialty Chemicals: Updates for the Week Ending January 11 (Continued from Prior Part) ## Axalta’s 2019 automotive color of the year On January 10, Axalta (AXTA) choose ‘Sahara,’ a golden bronze tone, as the 2019 automotive color of the year. Sahara radiates warmth and brings richness and strength to all vehicles irrespective of sizes. Axalta showcased Sahara in manufacturing facilities as well as the aftermarket for the first time in the five-year history of the automotive color of the year. Sahara could be the main color for two-tones. Axalta has been announcing the automotive color of the year since 2015. Axalta selected Radiant Red in 2015, Brilliant Blue in 2016, Gallant Gray in 2017, and Starlite in 2018. Axalta will display Sahara at the 2019 North American International auto show in Detroit. Dan Benton, the marketing manager ofAxalta’s refinish color department, said, “Axalta’s Color of the Year is another example of how Axalta transfers OEM technology to the aftermarket and repair businesses. We get calls every year from some of the industry’s best custom builders looking to use color to differentiate their products. We have Sahara formulated and ready-to-go in our industry-leading refinish brands including Cromax, Standox, and Spies Hecker.” ## Axalta’s stock price update Axalta continued its upward trend in 2019. The stock gained 4.8% and closed at $24.96 for the week ending January 11. The gain in the stock price helped narrow the company’s 100-day moving average gap. Axalta traded 4.8% below its 100-day moving average price of $26.23. So far in 2019, Axalta has gained 6.6%%. RPM International (RPM) and PPG Industries have declined 7.0% and 0.4%, respectively, while Sherwin-Williams (SHW) has gained 0.6%. Axalta’s 14-day RSI (relative strength index) is at 61, which indicates that the stock isn’t overbought or oversold. An RSI of 30 and below suggests that the stock is oversold, while an RSI of 70 and above suggests that the stock is overbought. Investors can hold Axalta indirectly by investing in the iShares U.S. Basic Materials ETF (IYM). IYM has invested 0.9% of its holdings in Axalta as of January 11. Browse this series on Market Realist: * Part 1 - Hanwha Total Petrochemical: W.R. Grace’s New Order * Part 2 - IFF Collaborates with Aryballe on Digital Nose * Part 3 - PPG Industries Launched a New Polyurethane Primer
Specialty Chemicals: Updates for the Week Ending January 11 ## W.R. Grace gets a new order On January 8, W.R. Grace (GRA) announced that it got a new order for its UNIPOL PP Process Technology. W.R. Grace will grant the licenses to Hanwha Total Petrochemical for its new PP production plant in Daesan, South Korea. The new facility will have the capacity to produce 400 kilotons per year. The plant is expected to be completed by 2021. W.R. Grace didn’t specify anything about the financial aspects of the deal. Hanwha Total Petrochemical is a joint venture between Hanwha General Chemicals and Total S.A.—a French oil and gas company. The companies have 13 plants in Daesan producing polymers, oil products, and base chemicals. Laura Schwinn, the president of W.R. Grace’s Specialty Catalysts business segment, said, “Grace is pleased to be selected to provide our technology and catalysts to Hanwha Total Petrochemical and to help them offer the broad capability and most advanced resins that deliver significant value to their customers.” ## Stock update W.R. Grace stock gained 1.4% for the previous week and closed at $67.81. Since the beginning of 2019, the stock has gained 4.5%. In 2018, the stock fell 7.4%. Analysts expect W.R. Grace’s target price to be $82.83, which implies a return potential of 22.2% over the closing price on January 11. W.R. Grace’s 14-day relative strength index of 66 suggests that the stock is moving closer to the “overbought” position. Investors could hold W.R. Grace indirectly by investing in the iShares U.S. Basic Materials ETF (IYM). IYM has invested 0.8% of its portfolio in W.R. Grace. The fund also has exposure to DowDuPont (DWDP), Linde (LIN), and LyondellBasell (LYB) with weights of 21.5%, 15%, and 4.6%, respectively, as of January 11. Continue to Next Part Browse this series on Market Realist: * Part 2 - IFF Collaborates with Aryballe on Digital Nose * Part 3 - PPG Industries Launched a New Polyurethane Primer * Part 4 - Axalta: ‘Sahara’ Is the 2019 Automotive Color of the Year
As of January 10, RPM International’s (RPM) dividend yield stood at 2.54%—its second-highest quarterly dividend yield since the first quarter of 2015. PPG Industries (PPG) and Sherwin-Williams (SHW) have a dividend yield of 1.89% and 0.86%, respectively, while Axalta (AXTA) hasn’t paid a dividend.
APD to Build Second Hydrogen Plant in California ## APD to build second hydrogen facility in California On January 7, Air Products and Chemicals (APD) announced that it plans to build a second liquid hydrogen plant in California. The decision came on the back of the increase in demand from various consumer markets, specifically from the growing demand for hydrogen fuel cell vehicles. APD also said the project development work is already underway and expects the plant to be commissioned in the first quarter of 2019. However, APD did not specify the financial aspects of building the plant. Liquefied hydrogen is used in several industries like electronics, material handling, float glass, edible fats and oils, chemical and petrochemical, and so on. In September 2018, APD announced its plan to build a liquid hydrogen plant in La Porte, Texas. Marie Folkes, APD’s president for the Americas segment, said, “Current customer demand for liquid hydrogen is driving the need for this new investment as we are experiencing growth from many traditional market segments, for which a reliable source of this product is vitally important. Additionally, this new capacity will be available for the steadily increasing demand from hydrogen fuel cell vehicles.” ## Stock prices APD stock declined 1.0% and closed at $159.93. The decline in the stock price pushed the stock to trade 0.8% below its 100-day moving average price of $161.31. In 2018, APD declined by 2.5% and outperformed the S&P 500. With several projects scheduled to be commissioned in 2019, APD’s growth path looks intact. Investors can indirectly hold APD by investing in the iShares U.S. Basic Materials ETF (IYM). IYM invests 6.2% of its portfolio in APD. The fund also provides exposure to DowDuPont (DWDP), Linde (LIN), and LyondellBasell (LYB) with weights of 21.8%, 14.9%, and 4.70%, respectively, as of January 7, 2019.
Axalta Signs a Three-Year Global Alliance with Plenham ## Axalta in a global alliance On January 4, Axalta (AXTA) announced a three-year global alliance with Plenham—the parent company of Bodyshop and IBIS Worldwide. The alliance aims to share business improvement ideas, innovation, best practices, new process establishment, and knowledge through media and social interactions. The alliance is expected to help Axalta leverage its global refinish expertise to enhance Plenham’s worldwide media platforms and networks. The partnership will likely start with the IBIS USA 2019 symposium in San Diego on February 13–15. Jim Muse, Axalta’s Vice President of Global Refinish sales, said, “I am confident that this new alliance between Plenham and Axalta will significantly benefit our customers and the overall global collision repair industry. Axalta’s long and successful track record in helping our customers enhance efficiency by using new products and technologies combined with Plenham’s extensive network of body shops around the world make this a powerful combination. Together, we can advance new thinking and technologies quicker and get faster feedback on ideas that will make our industry better and more cost-effective than ever before. This is truly a win-win for our two companies and, as importantly, for the entire industry. We are excited to get started in 2019.” ## Axalta’s stock performance Axalta started 2019 on a positive note and rose 4.1% in the first week of 2019. In 2018, Axalta fell 27.6%. Axalta is trading 10.2% below the 100-day moving average price of $26.50, which indicates that the stock is on a downward trend. Analysts are positive about Axalta. Analysts recommended a target price of $29.40, which implies a potential return of ~23.5% over the closing price as of January 4. The company’s 14-day relative strength index indicates that the stock isn’t overbought or oversold. Investors could hold Axalta indirectly by investing in the iShares U.S. Basic Materials ETF (IYM), which has invested 0.9% of its portfolio in Axalta. The fund also provides exposure to DowDuPont (DWDP), Linde (LIN), and Air Products and Chemicals (APD) with weights of 22.4%, 15.4%, and 6.3%, respectively, as of January 4.
As of December 27, Air Products and Chemicals’ dividend yield stood at 2.75%, which is marginally higher than the third-quarter dividend yield of 2.63%. LyondellBasell (LYB), Eastman Chemical (EMN), and Celanese (CE) have dividend yields of 4.8%, 3.5%, and 2.46%, respectively.
In a press release on December 12, International Flavors & Fragrances (IFF) announced the rates and key dates for its fourth-quarter dividend. To be eligible for IFF’s fourth-quarter dividend, investors must hold shares in the company as of the close of market on December 28. IFF’s peers Sensient Technologies (SXT), the Clorox Company (CLX), and Estée Lauder (EL) have paid fourth-quarter dividends of $0.36, $0.96, and $0.43, respectively.
On December 21, Axalta (AXTA) announced that it entered into a collaboration with Allure Industries—an Indonesian-based architectural product specialist company. The collaboration was formed by Axalta to launch its Colorista—an architectural powder coating. Axalta’s powder coating technology meets the international standard with zero volatile organic compounds.
In a press release on December 17, W.R. Grace (GRA) announced that it would increase FCC (fluid catalytic cracking) prices. The price increase will be effective in 2019. The price increase will be 3%–9% based on the product type and specific customer commitments.
On December 17, 2018, Air Products and Chemicals (APD) announced that it would increase the prices of bulk and industrial gases. For now, the price increase will only occur in North America. The price increase includes product price, monthly service charges, and surcharges for merchant customers.
As of December 12, Eastman Chemical (EMN) traded at a one-year forward PE ratio of 7.9x, which is well below the two-year average of 10.5x. Celanese (CE), Westlake Chemical (WLK), and LyondellBasell (LYB) were trading at one-year forward PE ratios of 7.9, 8.0x, and 7.5x, respectively. The forward PE ratio is a valuation method that considers a company’s future earnings estimates.
On December 6, Axalta (AXTA) announced that it received approval from Porsche AG to use Axalta’s three premium refinish brands. The premium refinish brands will be used by Porsche dealerships and body shops worldwide. The brands include Cromax, Spies Hecker, and Standox.
As of the close on December 6, LyondellBasell’s (LYB) dividend yield was 4.53%—the highest dividend yield recorded in the past six years on a sequential basis. Eastman Chemical (EMN), Celanese (CE), and Huntsman Chemical (HUN) have current dividend yields of 2.9%, 2.1%, and 3.2%, respectively. In comparison, LyondellBasell’s dividend yield is the best among the selected peers.
As of November 28, Eastman Chemical (EMN) was trading at a one-year forward PE multiple of 8.7x, which is well below the two-year average of 10.5x. Celanese (CE) and Westlake Chemical (WLK) were trading at one-year forward PE multiples of 9.0x and 8.3x, respectively. The forward PE multiple is a valuation method that considers a company’s future earnings estimates.
In a press release of November 21, Axalta (AXTA) announced that Michael Finn, the company’s senior vice president, general counsel, and corporate/government affairs and corporate secretary, stepped down. Axalta said that he’s leaving the company to pursue other career opportunities. Finn has been with Axalta since 2013.
DowDuPont (DWDP) announced its Q3 earnings before the market opened on November 1. It reported adjusted EPS of $0.74, an increase of 34.5% over its pro forma adjusted EPS of $0.55 in Q3 2017. The company beat analysts’ adjusted EPS estimate of $0.72. In this series, we’ll look at DowDuPont’s earnings, revenues, and segment-wise performance.
On November 6, Air Products and Chemicals (APD) reported revenues of $2.30 billion for the fourth quarter, which reflects 4.3% growth compared to the fourth quarter of 2017. The company fell marginally short of Wall Street analysts’ estimates of $2.31 billion. Air Products and Chemical’s revenue growth increased 3% due to higher volumes, 1% due to higher pricing, and 1% due to the favorable energy pass through. However, unfavorable foreign currency had a negative impact on Air Products and Chemicals’ revenues by 1%.
Air Products and Chemicals (APD) is expected to report adjusted EPS of $1.99 for the fourth quarter of fiscal 2018—an increase of ~13.1% from the corresponding quarter last year. In the fourth quarter of 2017, Air Products and Chemicals reported adjusted EPS of $1.76. Air Products and Chemicals’ projected growth in adjusted EPS is expected to be driven by higher sales growth and a lower tax rate.
DowDuPont (DWDP) announced its third-quarter earnings on November 1. The company reported revenues of ~$20.12 billion—10.0% growth compared to the pro forma revenues from continuing operations in the third quarter of 2017. The revenues fell marginally short of analysts’ expectations of $20.21 billion.