NEW YORK (TheStreet) -- PPG Industries' (PPG - Get Report) recent acquisition of Mexico City-based Comex Group for $2.3 billion gives PPG the second largest paint market share in Mexico behind rival Sherwin-Williams (SHW).
Currently, Comex has 3,600 stores compared to Sherwin-Williams' 3,900+ paint stores in Mexico. Sherwin-Williams had initially been set to acquire Comex for $2.34 billion, but the deal was terminated. Given that PPG Industries business is largely in the automotive coating segment, this deal has a higher probability of going through, giving PPG a more diversified business if accepted.
When comparing the large players in the industry, Sherwin-Williams only has PPG Industries beat on two key metrics. Sherwin-Williams trades at a P/E ratio of 19.33x (2015 estimates) with 23.6% EPS growth, price to sales ratio of 1.93x, price to book ratio of 12.09x, and has 6.8% revenue growth (9.3% this year). This compares to PPG Industries' P/E ratio of 18.72x (2015 estimates) with 17.7% EPS growth, price to sales ratio of 1.83x, price to book ratio of 4.79x, and has 8.1% revenue growth (2.1% this year).
Following these strong quarters the stock has closed higher on four of the last five days PPG has reported, averaging a 4.32% gain on the four higher closes. Shares currently trade around $208, up nearly 10% for the year to date. Call Buyers Sit Tight Ahead of the Upcoming Earnings Report Ahead of second-quarter earnings Thursday, the buyer of 4,000 July $210 calls for $3.60 each continues to remain long the $1.44 million bet (by far the largest open option position in PPG Industries). This trade from June 11 was part of a rollout from 2,495 July $200 calls for $8.30 each (paid $5.40-$6.70 on 5/28). The big buyer of the July $210 calls has a breakeven of $213.60, if held into July options expiration (2.68% above current levels).