It's shaping up to be a difficult year for PPG Industries (NYSE: PPG). As the architectural, automotive, and general industrial sectors go, so goes the paint-and-coatings industry. Unfortunately, the COVID-19 pandemic and has hit those industries hard, and as a result, PPG is forecasting a double-digit-percentage sales decline in 2020. However, it's also the case that 2020 could be the bottom of a multiyear business-cycle trough for the company. In that context, the stock looks interesting. Let's take a closer look.
PPG's stock has appeared to a good value over the past few months -- trading at 15.6 times forward earnings estimates, but after its recent gains, its forward P/E now sits at 18.4.
On a superficial level, the would seem to be a rich premium for a company that just reported a 25% sales decline in its second quarter and is expecting an 8% to 15% decline in sales volume in the third. Moreover, a quick look at PPG's sales by end market shows just why its revenues have been badly hit in 2020.