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Air Products (APD) Supplying Nitrogen for Boeing's New Jet

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Air ProductsAPD has been chosen by aerospace giant, Boeing to supply nitrogen for the world's biggest autoclave. The industrial gases company said that it has installed an advanced nitrogen supply system at Boeing's new 777X Composite Wing Center in Everett, WA.

The nitrogen supplied by Air Products to the autoclave will create an inert atmosphere and rapid pressure needed to form and cure large carbon fiber composite wings for Boeing's new 777X commercial jetliners. According to Boeing, the 777X will be the largest and most efficient twin-engine jet in the world.

Boeing's assembled wings are placed into the autoclave - a strong heated container used for chemical reactions and other processes using elevated temperature and pressure. It is then closed, sealed and flooded with nitrogen at certain flow rates, pressures and temperatures to purge out oxygen which creates the atmosphere needed for the curing process.

Air Products has been supplying gases to the aerospace industry for more than five decades. Its advanced nitrogen supply system includes three 15,000-gallon liquid tanks and a steam sparged water bath vaporization system. This project represents the third major autoclave project the company has completed with Boeing over the last three years.

Air Products has underperformed the Zacks categorized Chemicals-Diversified industry over the past three months. While the company's shares declined around 1% over this period, the industry recorded a gain of 7.5%.

Air Products missed earnings and sales expectations in first-quarter fiscal 2017 (ended Dec 31, 2016). Its adjusted earnings of $1.47 per share fell short of the Zacks Consensus Estimate of $1.48. Revenues edged up 1% year over year to $1.88 billion in the reported quarter, but trailed the Zacks Consensus Estimate of $1.96 billion.

Air Products' industrial gases business in the Europe, Middle East, and Africa ("EMEA") region is seeing pressure from a weak operating environment. The company is also seeing lower volumes in Latin America due to weak demand. Moreover, volumes in packaged gases continue to be weak while LNG sales remain under pressure due to low project activity.

The company is also exposed to currency headwinds. Moreover, it still has a debt-laden balance sheet.

Air Products currently carries a Zacks Rank #4 (Sell).

Air Products and Chemicals, Inc. Price and EPS Surprise

Air Products and Chemicals, Inc. Price and EPS Surprise | Air Products and Chemicals, Inc. Quote

Stocks to Consider

Better-ranked companies in the chemical space include Kronos Worldwide, Inc. KRO , Methanex Corporation MEOH and Albemarle Corporation ALB .

Kronos has an expected long-term growth of 5% and sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.

Methanex, also a Zacks Rank #1 stock, has an expected long-term growth of 15%.

Albemarle holds a Zacks Rank #2 (Buy) and has an expected long-term growth of 10%.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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