PPG - PPG Industries Acquisition Strategy Fails To Deliver Growth

2024-06-04 09:08:51 ET

Summary

• PPG operates in a low-growth sector and has relied on acquisitions for growth, but its revenue growth has been modest.
• Profits and returns have declined, indicating a lack of improving operating and capital efficiency.
• The market has priced PPG as if it will undertake another major acquisition next year, but this is unlikely and the stock is not an investment opportunity.

Investment Thesis

PPG Industries, Inc. ( PPG ) operates in a low-growth sector and has adopted an acquisition strategy to drive growth. Despite continuous annual acquisitions, it achieved only a 2.7% CAGR in revenue over the past decade. Profits and returns declined, and there was no sign of improving operating or capital efficiency....

For further details see: