PPG
PPG Industries, Inc.
$107.78
Stable Earnings Power
65%
P/Adj-EPS × Normalized Multiple
Mild
·
Conviction
Fair Value
Trading 2.9% below fair value
You pay
$107.78
Bear
$88.77
Fair
$110.96
Bull
$133.15
Bear
$88.77
-17.6%
$6.92 × 12x P/E
Fair
$110.96
+3.0%
$6.92 × 15x P/E
Bull
$133.15
+23.5%
$6.92 × 18x P/E
Key Value Driver
Normalized P/E multiple (15x base case)
Implied Market Multiple
15.6x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $127.67 from 38 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $110.96 per share.
Warnings
Dividend-based valuation: $69.71 (below our primary estimate by 33%). Large gaps may signal the dividend doesn't reflect full earning power.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples