Industrial gas firms see slow April - analysts

23 May 2006 16:58  [Source: ICIS news]

HOUSTON (ICIS news)--Industrial gas suppliers Praxair and Air Products posted modest April sales numbers this week due in part to fewer work days in the month, analysts said on Tuesday.

“We maintain our neutral ratings on Praxair, Air Products and Airgas since lofty valuation multiples already reflect positive fundamental trends in our view,” said Kevin McCarthy, of Banc of America (BoA) Securities.

Deutsche Bank rated Praxair and Air Products as buys, citing reasonable earnings per share estimates for both companies.

“With continued strength in packaged gases and Asian electronics, we believe underlying business trends remain unchanged (for Praxair),” said Deutche Bank analyst David Begleiter, adding that the company has the biggest backlog in its history.

As for Air Products, Deutsche Bank cited exceptional liquid oxygen and liquid nitrogen pricing and robust electronics sales trends as reasons that it remains positive on the Allentown, Pennsylvania-based company.

“Despite a weak start to the quarter, we believe Air Products remains on track to meet our third-quarter estimate of 90 cents, up 10%. With valuation a reasonable 18.1 times 2006 estimated earnings per share, we reiterate our buy rating,” said Deutsche Bank.

Deutsche Banks set its price target for Danbury, Connecticut-based Praxair at $64 and Air Products at $75.

On Tuesday morning, Air Products shares were trading $64.68; Praxair shares at $54.26 and Radnor, Pennsylvania-based Air Gas shares at $37.11.

By: Joseph Lohan
+1 713 525 2653

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