In an attempt to expand its operational roots, leading
industrial gas producer and supplier
) wholly-owned subsidiary Praxair Distribution, Inc., recently
launched its newest store in Warwick, R.I. The newly introduced
store will be primarily engaged in the supply of various types of
packaged gases such as industrial and specialty gases to the
clients. In addition, Praxair's new facility will also provide a
range of safety products, hardgoods and welding equipment to the
The company's strategy of expanding its operations and adding
new customers to its existing sphere of business has accelerated
its profit growth. There is still a huge opportunity for Praxair to
grow in future due to the increased demand for the industrial gases
in several sectors. The company is estimating that the annual
organic sales growth will be 8%-12% by 2015. Operating profit,
driven by higher productivity and effective pricing actions is
expected to be within the 10%-15% range; earnings are also likely
to grow within the 12%-18% range. Moreover, the company's earnest
effort in returning values to shareholders through dividends and
share buybacks is likely to boost investors' confidence.
In its first quarter 2012, Praxair fared well reporting an EPS
of $1.38, up 1.5% year over year and two cents above the Zacks
Consensus Estimate. Revenue gained 5% y/y on the back of the
company's impressive performance in the North American and Asian
However, the company pertains to an industry where ominous
competition is prevalent. Hence, Praxair should stay cautious of
big players, such as
Koppers Holdings Inc.
TOR Minerals International Inc.
Eastman Chemical Co.
) who are operating in the market.
The current Zacks Consensus Estimate for the second quarter of
2012 is $1.43, representing a year-over-year increase of 3.93%.
Estimates for the fiscal years 2012 and 2013 are $5.82 and $6.62,
reflecting annual growth of 7.19% and 13.82%, respectively. We
maintain a Neutral recommendation on Praxair. Currently, the stock
carries a Zacks #3 Rank, implying a short-term (1-3 months) Hold
EASTMAN CHEM CO (EMN): Free Stock Analysis
KOPPERS HOLDNGS (KOP): Free Stock Analysis
PRAXAIR INC (PX): Free Stock Analysis Report
(TORM): ETF Research Reports
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