Why You Shouldn’t Be Buying PPG Industries Stock
PPG Industries (NYSE:PPG) stock looks very unattractive – making it a very bad pick to buy at its current price of around $105. PPG Industries is a leading global supplier of paints, coatings, and specialty materials. We believe there are several major concerns with PPG stock, which makes it very unattractive given that its current valuation looks moderate.
We arrive at our conclusion by comparing the current valuation of PPG stock with its operating performance over the recent years, as well as its current and historical financial condition. Our analysis of PPG Industries along key parameters of Growth, Profitability, Financial Stability, and Downturn Resilience shows that the company has a very weak operating performance and financial condition, as detailed below. That said, if you seek upside with lower volatility than individual stocks, the Trefis High Quality portfolio presents an alternative – having outperformed the S&P 500 and generated returns exceeding 91% since its inception.
How Does PPG Industries’ Valuation Look vs. The S&P 500?
Going by what you pay per dollar of sales or profit, PPG stock is currently valued in line with the broader market.
• PPG Industries has a price-to-sales (P/S) ratio of 1.7 vs. a figure of 3.1 for the S&P 500
• Additionally, the company’s price-to-free cash flow (P/FCF) ratio is 30.9 compared to 20.3 for S&P 500
• And, it has a price-to-earnings (P/E) ratio of 22.2 vs. the benchmark’s 22.8
How Have PPG Industries’ Revenues Grown Over Recent Years?
PPG Industries’ Revenues have fallen over recent years.
• PPG Industries has seen its top line decline at an average rate of 5.2% over the last 3 years (vs. an increase of 5.3% for S&P 500)
• Its revenues have decreased 6.7% from $16 Bil to $15 Bil in the last 12 months (vs. growth of 4.4% for S&P 500)
• Also, its quarterly revenues fell 4.3% to $3.7 Bil in the most recent quarter from $3.8 Bil a year ago (vs. 4.5% improvement for S&P 500)
How Profitable Is PPG Industries?
PPG Industries’ profit margins are much worse than most companies in the Trefis coverage universe.
• PPG Industries’ Operating Income over the last four quarters was $2.2 Bil, which represents a poor Operating Margin of 14.8% (vs. 18.3% for S&P 500)
• PPG Industries’ Operating Cash Flow (OCF) over this period was $1.5 Bil, pointing to a poor OCF Margin of 10.0% (vs. 19.8% for S&P 500)
• For the last four-quarter period, PPG Industries’ Net Income was $1.1 Bil – indicating a poor Net Income Margin of 7.4% (vs. 11.8% for S&P 500)
Does PPG Industries Look Financially Stable?
PPG Industries’ balance sheet looks fine.
• PPG Industries’ Debt figure was $7.9 Bil at the end of the most recent quarter, while its market capitalization is $24 Bil (as of 7/30/2025). This implies a moderate Debt-to-Equity Ratio of 32.5% (vs. 23.4% for S&P 500). [Note: A low Debt-to-Equity Ratio is desirable]
• Cash (including cash equivalents) makes up $1.9 Bil of the $21 Bil in Total Assets for PPG Industries. This yields a moderate Cash-to-Assets Ratio of 9.0% (vs. 6.7% for S&P 500)
How Resilient Is PPG Stock During A Downturn?
PPG stock has fared worse than the benchmark S&P 500 index during some of the recent downturns.
Inflation Shock (2022)
• PPG stock fell 40.5% from a high of $182.33 on 4 June 2021 to $108.50 on 16 June 2022, vs. a peak-to-trough decline of 25.4% for the S&P 500
• The stock is yet to recover to its pre-Crisis high
• The highest the stock has reached since then is 151.67 on 12 July 2023, and it currently trades at around $105
Covid Pandemic (2020)
• PPG stock fell 45.7% from a high of $133.49 on 1 January 2020 to $72.50 on 23 March 2020, vs. a peak-to-trough decline of 33.9% for the S&P 500
• The stock fully recovered to its pre-Crisis peak by 8 October 2020
Global Financial Crisis (2008)
• PPG stock fell 65.4% from a high of $41.10 on 23 July 2007 to $14.24 on 5 March 2009, vs. a peak-to-trough decline of 56.8% for the S&P 500
• The stock fully recovered to its pre-Crisis peak by 20 December 2010
Putting All The Pieces Together: What It Means For PPG Stock
In summary, PPG Industries’ performance across the parameters detailed above is as follows:
• Growth: Very Weak
• Profitability: Very Weak
• Financial Stability: Neutral
• Downturn Resilience: Very Weak
• Overall: Very Weak
This isn’t appropriately reflected in the stock’s moderate valuation, which is why we think it is very unattractive, which supports our conclusion that PPG is currently a very bad stock to buy.
While you would do well to avoid PPG stock for now, you could explore the Trefis Reinforced Value (RV) Portfolio, which has outperformed its all-cap stocks benchmark (combination of the S&P 500, S&P mid-cap, and Russell 2000 benchmark indices) to produce strong returns for investors. Why is that? The quarterly rebalanced mix of large-, mid- and small-cap RV Portfolio stocks provided a responsive way to make the most of upbeat market conditions while limiting losses when markets head south, as detailed in RV Portfolio performance metrics.
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