APD - Embedded Expectations Analysis - 2019 03 12
Air Products and Chemicals, Inc. (APD:USA) currently trades near historical highs relative to UAFRS-based (Uniform) Assets, with a 2.1x Uniform P/B, implying bullish expectations for the firm. However, management may be concerned about their ability to sustain price improvements in EMEA, manage capital deployment, and remain the most profitable industrial gas firm.Specifically, management may lack confidence in their ability to sustain price improvements in EMEA regions, and in the sustainability of EPS improvements related to raw material tailwinds. Moreover, they may lack confidence in their ability to achieve EPS guidance, given macroeconomic uncertainty. Additionally, management may be concerned about their ability to manage their capital deployment and forecasted costs. Finally, they may be concerned about their ability to remain the most profitable industrial gas firm, and may lack confidence in their ability to maintain their helium supply.
Air Products and Chemicals serves customers globally with a portfolio of products, services, and solutions that include atmospheric gases, process and other gases, equipment, and services. The company is a supplier of hydrogen and is engaged in helium and liquefied natural gas (LNG) process technology and equipment. The company also develops, engineers, builds, owns and operates industrial gas projects, including gasification projects that convert abundant natural resources into syngas for the production of power, fuels and chemicals. The company designs and manufactures equipment for air separation, hydrocarbon recovery and purification, LNG, and liquid helium and liquid hydrogen transport and storage.
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