APD

Air Products & Chemicals Inc.

Industrial/Transportation


Presented:09/23/2020
Price:$285.43
Cap:$63.05B
Current Price:$323.23
Cap:$71.86B

Presented

Date09/23/2020
Price$285.43
Market Cap$63.05B
Ent Value$56.22B
P/E Ratio33.08x
Book Value$52.78
Div Yield1.75%
Shares O/S220.89M
Ave Daily Vol1,099,950
Short Int0.84%

Current

Price$323.23
Market Cap$71.86B
Air Products & Chemicals, Inc. engages in the manufacture and distribution of atmospheric gases. It operates through the following segments: Industrial Gases-Americas; Industrial Gases-EMEA (Europe, Middle East, and Africa); Industrial Gases-Asia; Industrial Gases-Global; and Corporate and Other. The Industrial Gases-America, EMEA and Asia segment markets and produces atmospheric gases such as oxygen, nitrogen, argon, and rare gases; process gases such as hydrogen, helium, carbon dioxide, carbon monoxide, syngas, and specialty gases; and equipment for the production and processing of gases such as air separation units and non-cryogenic generators. The Industrial Gases-Global segment comprises cryogenic and gas processing equipment for air separation. The Corporate and Other segment includes LNG equipment and helium storage and distribution sale of equipment businesses and corporate support functions. The company was founded by Leonard Parker Pool on September 30, 1940 and is headquartered in Allentown, PA.

Publicly traded companies mentioned herein: Air Products and Chemicals Inc (APD), Cheniere Energy Inc (LNG), Saudi Arabian Oil Co (ARAMCO AB), PBF Energy Inc (PBF) 

Highlights

The presenter is long APD, which he describes as an unregulated utility with an increasingly attractive investment case that has lost hedge fund interest in recent years. He believes the bull case for APD has shifted over the last 6-7 years from margin expansion/cost cutting to capital deployment. His thesis is largely dependent on the company’s CEO, Seifi Ghasemi, who is touted as “one of the best capital allocators on the street,” and the continuation of effective capital deployment. Given the company’s strong track record of investments, he expects earnings to triple by 2024 generating an IRR of ~30% through the period.

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Idea Discussion

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