Why Is PPG Industries (PPG) Down 6% Since Last Earnings Report?

A month has gone by since the last earnings report for PPG Industries (PPG). Shares have lost about 6% in that time frame, underperforming the S&P 500.Will the recent negative trend continue leading up to its next earnings release, or is PPG Industries due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts. PPG Industries' Earnings and Sales Miss Estimates in Q3PPG Industries reported a third-quarter 2024 profit of $468 million or $2 per share, up from $426 million or $1.79 per share in the year-ago quarter.In the reported quarter, excluding one-time items, adjusted earnings per share increased to $2.13 from $2.07 in the year-ago quarter, missing the Zacks Consensus Estimate of $2.15.The company’s revenues were roughly $4.57 billion in the quarter, down roughly 1.5% year over year. The fall was due to soft global industrial production, which affected demand in the Industrial Coatings segment. The top line missed the Zacks Consensus Estimate of $4.65 billion.Segment ReviewThe Performance Coatings segment’s third-quarter revenues increased 1.4% year over year to around $2.92 billion. Net revenues increased due to higher sales volumes and selling prices. Segment income climbed 13%, driven by higher sales volumes and prices, partly offset by general cost inflation. Revenues in the Industrial Coatings segment were down 6.2% year over year to roughly $1.65 billion. Net sales were lower than the year-ago quarter due to a fall in sales volumes and selling prices from some index-based client contracts. Segment income fell 19% over the previous year due to lower sales volumes and reduced selling prices on certain index-based pricing contracts.FinancialsAt the end of the third quarter, the company had roughly $1.25 billion in cash and cash equivalents, up around 2.7% year over year. Long-term debt was around $6.14 billion, up from $5.6 billion in the prior-year quarter.OutlookPPG anticipates flat organic sales and adjusted earnings per share at the bottom end of the $8.15 to $8.30 range for full-year 2024.How Have Estimates Been Moving Since Then?In the past month, investors have witnessed a downward trend in fresh estimates.VGM ScoresCurrently, PPG Industries has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.OutlookEstimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise PPG Industries has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.Must-See: Solar Stocks Poised to SkyrocketThe solar industry stands to bounce back as tech companies and the economy transition away from fossil fuels to power the AI boom.Trillions of dollars will be invested in clean energy over the coming years – and analysts predict solar will account for 80% of the renewable energy expansion. This creates an outsized opportunity to profit in the near-term and for years to come. But you have to pick the right stocks to get into.Discover Zacks’ hottest solar stock recommendation FREE.Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report PPG Industries, Inc. (PPG): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks