APD

Air Products & Chemicals Inc

Industrial/Transportation


Presented:08/14/2018
Price:$164.33
Cap:$36.03B
Current Price:$323.23
Cap:$71.86B

Presented

Date08/14/2018
Price$164.33
Market Cap$36.03B
Ent Value$35.60B
P/E Ratio23.87x
Book Value$47.82
Div Yield2.48%
Shares O/S219.27M
Ave Daily Vol1,028,997
Short Int0.81%

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; Materials Technologies; and Corporate and Other. The Industrial Gases segment, which covers Americas, EMEA, Asia, and Global markets, 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 Materials Technologies segment comprises of performance, and electronic materials. The Corporate and Other segment includes liquefied natural gas, and helium container businesses. 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 & Chemicals Inc (APD), Linde AG (LINU GR), Praxair Inc (PX), Shanxi Lu'an Environmental Energy Development Co Ltd (601699 CH), Versum Materials Inc (VSM)

Highlights

The presenter is long Air Products & Chemicals (APD) and likes the risk/reward at ~$160. With the economic recovery getting “long in the tooth” and concerns about global trade friction and inflation mounting, exposure to companies such as APD with stable pricing power, market control, and idiosyncratic - not cyclical - drivers makes sense. APD’s business mix is shifting in favor of larger onsite projects and there is substantial excess capital available for CEO Seifi Ghasemi to allocate/invest over the next 3 - 5 years. Assuming APD can earn $11/share in 2021 and the stock trades at 20x, investors could see a total return of 35% - 40% over the next two years.

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Idea Discussion

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