APD Air Products and Chemicals Inc

Praxair Inc. (PX) is all set to raise funds from the market  through issuance of 3% notes due September 1, 2021. The issue, amounting to $500 million, was recently priced by the company and expected to close on September 6, 2011.

Praxair intends to use the proceeds to repay its short-term debt, repurchase shares under its share buyback program, and also for general corporate purposes. The funds may also be invested in short-term investments before being utilized for the above mentioned purposes.

Currently, the company's long-term debt is rated A2 by Moody’s Investors Service and A by Standard and Poor’s, a division of The McGraw-Hill Companies. Earlier in March 2011, Praxair raised similar amounts of funds through the issuance of 4.05% notes due March 15, 2021.

Praxair is a leading industrial gas supplier which primarily caters to demands in North America, South America, Europe, and Asia. Globally, rising demand for industrial gases is matched with the growth in their application areas. The requirement for hydrogen for refining; oxygen for healthcare; and nitrogen and carbon dioxide for oil and gas production is ever on the rise, worldwide.

The company aims to achieve annual organic sales growth in the range of 8%-12%, with emerging markets, including South America, Asia, and Mexico, accounting for an estimated target of 45% of total sales by 2015.

The current Zacks Consensus Estimate for the third quarter is $1.39, representing a year- over-year increase of 14.88%. Estimate for the fiscal year 2011 and 2012 is $5.48 and $6.24, reflecting annual growth of 15.53% and 13.95%, respectively.

The company faces stiff competition from its rivals like Air Products and Chemicals Inc.(APD) and Airgas Inc. (ARG). We currently maintain a Neutral recommendation on Praxair.

 
AIR PRODS & CHE (APD): Free Stock Analysis Report
 
AIRGAS INC (ARG): Free Stock Analysis Report
 
PRAXAIR INC (PX): Free Stock Analysis Report
 
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