Praxair Increases Capacity - Analyst Blog
May 09 2011 - 2:00PM
Zacks
Praxair Inc. (PX) recently announced the
opening of a new coating facility in Singapore via its wholly-owned
subsidiary, Praxair Surface Technologies. The coating facility will
primarily tap the growing demand in aviation and energy
markets.
The facility has commenced operations by providing thermal spray
coatings for gate valve and other critical components used in oil
and natural gas production. The company plans to enhance its
capabilities by enabling service for aviation and industrial gas
turbine markets.
Praxair, one of the leading companies engaged in the production
and distribution of industrial gases, has significant growth
opportunities in diverse markets. Its concerted effort in
increasing exposure and tapping opportunities in emerging markets
is also very encouraging. Further, the coating facility in
Singapore enables Praxair to offer its services in Southeast
Asia.
Moreover, the growth prospects of industrial gas producers are
very bright with demand for gases ever rising due to their wide
application areas, including chemical processing and petroleum
refining, metal production and fabricating, and electronics and
health care industries.
Praxair anticipates that EPS would be roughly $5.35-$5.45 and
revenue to be approximately $11 billion for the fiscal year 2011.
For the second quarter, the company anticipates earnings to be
roughly within $1.33-$1.38 range.
However, excessive dependence on international revenue and
energy costs, both volatile in nature, is risky. The company also
operates in a highly-competitive environment, which may adversely
affect top-line results. It faces stiff competition from peers like
Air Products and Chemicals Inc. (APD) and
Airgas Inc. (ARG).
We currently maintain a Neutral recommendation on the stock.
AIR PRODS & CHE (APD): Free Stock Analysis Report
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PRAXAIR INC (PX): Free Stock Analysis Report
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