PPG Industries, Inc. (PPG)
Valuation Overview•Is PPG Industries, Inc. Overvalued or Undervalued?
Trading at a discount compared to peers, but the underlying intrinsic cash flows struggle to support the current price.
Moderate quality score of 65/100, reflecting stable operating margins and manageable leverage.
Wall Street forecasts a balanced outlook with consensus price targets near the current price.
Verdict: Solid fundamental quality, though growth presents a headwind.
Wall Street is broadly bullish, projecting solid upside alongside robust expected earnings growth. This outlook is strongly supported by highly attractive capital returns, driven by a balanced mix of reliable dividends and share buybacks.
PPG demonstrates strong business quality with robust profitability and healthy margins (highlighted by a massive 23.5% ROIC). This is paired with a moderately leveraged but stable balance sheet.
The company exhibits steady, low-single-digit revenue growth paired with robust earnings compounding (17.0% EPS 3Y CAGR). Operating efficiency remains adequate with margins around 12.8%.
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $3.9B | +0.2% | +0.6% | +2.8% | +1.1% | |
| EBITDA | $657.0M | — | +7.5% | — | — | |
| Net Income | $382.0M | +41.2% | +15.4% | — | +1.1% | |
| EPS (Diluted) | $1.70 | +45.7% | +17.0% | +9.2% | +3.0% | |
| Free Cash Flow | -$163.0M | +66.4% | +34.6% | -8.6% | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 40.6% | 40.0% | 39.0% | 41.4% |
| Operating Margin | 12.8% | 13.5% | 12.3% | 12.1% |
| Net Margin | 9.8% | 8.3% | 8.0% | 8.1% |
| FCF Margin | 7.6% | 7.8% | 6.7% | 7.9% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q2'26Latest | $1.78 | $1.83 | +2.8% | ||
| Q1'26 | $1.58 | $1.51 | -4.4% | ||
| Q4'25 | $2.10 | $2.13 | +1.4% | ||
| Q3'25 | $2.23 | $2.22 | -0.4% | ||
| Q2'25 | $1.62 | $1.72 | +6.2% | ||
| Q1'25 | $1.64 | $1.61 | -1.8% | ||
| Q4'24 | $2.15 | $2.13 | -0.9% | ||
| Q3'24 | $2.48 | $2.50 | +0.8% |
Total return is +11.8% (1Y), lagging the benchmark by -13.2%
| Period | Total Return | vs S&P 500 (Alpha) | Dividend Contribution |
|---|---|---|---|
| YTD | +14.6% | +5.3% | — |
| 1Y | +11.8% | -13.2% | +2.6% |
| 3YCAGR | -3.8% | -23.6% | +5.7% |
| 5YCAGR | -4.8% | -17.8% | +7.7% |
| 10YCAGR | +2.6% | -11.1% | — |
The S&P 500 is at 31.3x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about PPG Industries, Inc. (PPG) valuation, health, and returns.
PPG Industries, Inc. is estimated to be overvalued under our discounted cash flow framework. relative multiples indicate the stock is Cheap versus peers compared to industry peers. overvalued (implying -27.5% downside from DCF intrinsic value of $85.65)
PPG Industries, Inc. has multiple valuation anchors: DCF Intrinsic Value: $85.65 | Peer Relative Fair Value: $149.57 | Wall Street Analyst Target: $128.50 (implying +8.7% upside). A convergence of these signals offers higher conviction.
PPG Industries, Inc. displays good financial health with a composite quality score of 65/100, supported by a Altman Z-Score of 3.8 (safe zone), Piotroski F-Score of 7/9, Return on Invested Capital (ROIC) of 23.5%.
PPG Industries, Inc. pays a 2.3% dividend yield, covered by a 40% payout ratio with 43 years of growth, supplemented by a 3.0% buyback yield.
PPG Industries, Inc.'s current growth trajectory is Stable. The company achieved +0.2% 1Y revenue growth and +45.7% 1Y EPS growth, compared to its 3Y revenue CAGR of +0.6%.
Wall Street consensus is Buy based on 38 analysts, beating EPS expectations in 58% of recent quarters with a 1-quarter streak. The consensus price target represents a +8.7% change from current levels.
Investment risks for PPG Industries, Inc. include: -26.1% 1-year max drawdown. Volatility risk is characterized by a beta of 1.05x.
No. These computations are purely quantitative model outputs for informational purposes. They do not account for qualitative management shifts or macro events. Always consult a licensed RIA before buying or selling shares.
Disclaimer: This page is for informational purposes only and does not constitute financial advice. All valuation models, scores, and target estimates are automated computations under stated assumptions and should not be relied upon as the sole basis for any investment decision.