In a report released today, Steve Byrne from Bank of America Securities downgraded PPG Industries (PPG – Research Report) to a Hold, with a price target of $126.00.
Steve Byrne has given his Hold rating due to a combination of factors impacting PPG Industries. One of the primary concerns is the risk associated with tariffs, which are expected to increase raw material costs and potentially dampen demand. Although PPG has reduced its exposure to the housing market by selling its US and Canada architectural business, there remains a risk to its Mexico-based Comex business if tariffs continue to affect the Mexican economy.
Additionally, PPG’s automotive OEM and refinish segments could face demand challenges in a potential recession, given their sensitivity to consumer spending. The stock’s valuation is also a factor, as PPG’s shares have declined significantly, yet still trade at a premium compared to peers like AXTA, despite having greater exposure to the housing market. Consequently, while there is some potential for upside to the target price, Byrne sees more attractive opportunities elsewhere, leading to the Hold rating.
In another report released on April 7, UBS also maintained a Hold rating on the stock with a $110.00 price target.