Sherwin-Williams Company (SHW), PPG Industries, Inc. (PPG): This Specialty Chemicals Company Is in for Difficult Times

The company has all the catalysts for growth. Input costs are moderate, the automotive and aerospace sectors are growing strongly, and investors can look forward to some upside.

The Valspar Corporation (NYSE:VAL) recently concluded its takeover of Italy-based industrial coatings maker Inver Holding, and this adds to the capability of the company to expand its European coatings business. Valspar expects to reinforce its position in the $6 billion industrial coatings markets in Europe. Offering operational synergies, this acquisition will enable Valspar to leverage Inver’s strong product portfolio, leading technology and distribution network in order to expand client base and hence add to the top-line and earnings in the future.

With the company-wide focus on winning new businesses, Valspar is all set for a bright future. The company remains committed to making effective and meaningful investments in the world’s largest industrial markets such as China, Europe and Latin America to incite growth. Valspar expects to gain from new businesses in consumer paints, packaging, coil and wood coatings in the second half of fiscal 2013.

Final comment

Sherwin-Williams’ lack of diversification is a reason why I think that investors should consider staying away from it. In comparison, PPG makes for a better option given that it is more diversified and has a strong relationship with automakers.

ANUP SINGH has no position in any stocks mentioned. The Motley Fool recommends Sherwin-Williams.

The article This Specialty Chemicals Company Is in for Difficult Times originally appeared on Fool.com and is written by ANUP SINGH.

ANUP is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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