PPG Industries (PPG)
Materials · $27.7B market cap · SEC CIK 0000079879
ahead of 61% of the S&P 500 · #9 of 26 in Materials
Next reports on Jan 25, 2027, after the close, with analysts expecting $1.71 in earnings per share.
52-week range $93.39 to $133.43. 7% below its 52-week high and 33% above its low.
The case for PPG
- Return on equity of 19%.
- Pays a modest 1.9% dividend.
The case against
- Growth is weak (36/100): revenue +6.4%, +2.8% a year over five years.
- Weakest against its peers: revenue growth of +6.4% is slower than 56% of Materials companies.
What the score is made of
Each factor is half a curve over reported figures and half a rank among the other Materials companies (momentum is judged against fixed thresholds only), and the five are blended by weight. The score is where that blend places it in the S&P 500. It describes the last filing and the current price. It is not a forecast.
| Valuewhat you pay for the earnings and cash, against the growth you get | 58 |
|---|---|
| Growthhow fast revenue and earnings are moving, this year and over five | 36 |
| Profitabilityhow much of the revenue becomes profit, and how much of that is cash | 62 |
| Momentumhow the price has behaved lately | 75 |
| Stabilityhow violently it moves, what it owes and what it pays you | 72 |
- Its profits follow commodity prices, so its earnings and margin are read as half the latest year and half the average of the years on file (5), and last year's change in earnings per share is not counted as growth.
- Each factor except momentum is half fixed thresholds, half rank among the 26 Materials companies.
The financials
Revenue growth
Is the business growing? Slowly
| Last 12 months | +6.4% |
|---|---|
| Over 5 years | +2.8% a year |
| FY2025 revenue | $15.9B (0%) |
Free cash flow
Is it generating real cash? Yes
| FY2025 free cash flow | $1.2B |
|---|---|
| Of revenue | 7% |
| Of profit | 74% |
Profit margins
Is profitability improving? Yes, improving
| Gross margin | 41% |
|---|---|
| Operating margin | 13% |
| Net margin, FY24 → FY25 → now | 7.0% → 9.9% → 9.4% |
Debt vs. cash
Is the balance sheet healthy? Mostly, with some debt to carry
| Cash | $2.2B |
|---|---|
| Long-term debt | $6.6B |
| Net debt | $4.4B |
| Years to repay | 3.4 yrs |
Valuation
Is the stock price reasonable? Yes, about fair
| P/E | 17.6× |
|---|---|
| P/E on mid-cycle earnings | 19.4× |
| Fair P/E for its growth | 20× |
| P/FCF | 23.8× |
| Forward P/E | 14.0× |
| EV / EBITDA | 12.1× |
Its profits follow commodity prices, so they are taken as half the latest year and half the average of recent years. At 19.4× those mid-cycle earnings (17.6× the latest year's) it trades close to the 20× that 6% a year of growth plus a 1.9% dividend would justify. At 23.8× free cash flow it trades close to that same mark.
The financials, five years deep
Pulled from PPG Industries's XBRL filings on SEC EDGAR. Italic rows are worked out from the others.
| FY2025 | FY2024 | FY2023 | FY2022 | FY2021 | |
|---|---|---|---|---|---|
| Revenue growth | |||||
| Revenue | $15.9B | $15.8B | $16.2B | $15.6B | $16.8B |
| Change on the year | 0% | −2% | +4% | −7% | — |
| Free cash flow | |||||
| Free cash flow | $1.2B | $699M | $1.9B | $477M | $1.2B |
| Of revenue | 7% | 4% | 12% | 3% | 7% |
| Profit margins | |||||
| Operating margin | — | — | 16.5% | 13.1% | 12.9% |
| Net margin | 9.9% | 7.0% | 7.8% | 6.6% | 8.6% |
| Debt vs. cash | |||||
| Cash | $2.2B | $1.3B | $1.5B | $1.1B | $1.0B |
| Long-term debt | $6.6B | $4.9B | $5.7B | $6.5B | $6.6B |
| Net cash (debt) | −$4.4B | −$3.6B | −$4.3B | −$5.4B | −$5.6B |
What PPG Industries says it does
PPG Industries, Inc. manufactures and distributes a broad range of paints, coatings and specialty products. PPG was incorporated in Pennsylvania in 1883. PPG’s vision is to be the first-choice partner to meet our customers’ evolving needs for innovative paints, coatings and surface solutions to protect and beautify the world. PPG has a proud heritage with a demonstrated commitment to innovation, sustainability, community engagement and development of leading-edge paint, coatings and specialty products. Through dedication and industry-leading expertise, we solve our customers’ biggest challenges, collaborating closely to find the right path forward. PPG is a global leader that markets and sells in more than 50 countries. PPG supplies paints, coatings and specialty products to customers serving a wide array of end-uses, including industrial equipment and components; packaging material; aircraft and marine equipment; automotive original…
Risk factors PPG lists in its 10-K
- Increases in prices and declines in the availability of raw materials could negatively impact our financial results
- The pace of economic growth and level of economic and geopolitical uncertainty could have a negative impact on our results of operations and cash flows
- Fluctuations in foreign currency exchange rates could affect our financial results
- The industries in which we operate are highly competitive
- We are subject to existing and evolving standards relating to the protection of the environment
- We are involved in a number of lawsuits and claims, and we may be involved in future lawsuits and claims, in which substantial monetary damages are sought
- We are subject to a variety of laws and regulations, which could increase our compliance costs and could adversely affect our results of operations
- Changes in the tax regimes and related government policies and regulations in the countries in which we operate could adversely affect our results and our effective tax rate
- Our international operations expose us to additional risks and uncertainties that could affect our financial results
- The security of our information technology systems could be compromised which could adversely affect our operations or reputation
- We are incorporating artificial intelligence technologies into our research, products, services and processes. These technologies may present business, operational, compliance and reputational risks
- We may not effectively integrate acquired businesses into our existing operations
- Our ability to understand our customers’ specific preferences and requirements, and to innovate, develop, produce and market products that meet customer demand is critical to our business results
- Our business success depends on attracting, developing and retaining a qualified workforce
- PPG’s aerospace coatings business depends, in part, on our ability to successfully meet customer demand, production targets and commitments