JPMorgan raised its price target on PPG Industries (NYSE:PPG) to $126.00 from $117.00 and maintained an Overweight rating following the company’s fourth-quarter 2025 financial disclosure. The new target sits close to InvestingPro’s Fair Value estimate, which indicates that PPG shares, trading at $114.66 with a P/E ratio of 15.94, may be undervalued.
The bank’s revision reflects a mix of encouraging and disappointing elements in PPG’s quarterly report. Among the positives, PPG generated cash flow from operations of $1.9 billion for 2025, notably above JPMorgan’s modeled expectation of $1.45 billion. That stronger cash conversion likely informed the more optimistic valuation. The company’s $25.72 billion market capitalization accompanies $715 million in levered free cash flow over the last twelve months and supports a 2.49% dividend yield.
Yet not all metrics were favorable. PPG’s adjusted earnings per share for the fourth quarter came in at $1.51, below analyst expectations of $1.58. Still, the company exceeded revenue forecasts, posting $3.91 billion against a consensus estimate of $3.78 billion, a 5% increase year-over-year. On an organic basis, PPG recorded 3% sales growth driven by higher selling prices and volume growth across all geographic regions.
Auto refinish markets were highlighted as a persistent area of weakness during the quarter. CEO Tim Knavish, however, signaled some signs of improvement, saying there were "green shoots" in the segment. He noted that December accident claims were down 2% year-over-year, an improvement versus the 7-9% year-over-year decline reported through the fourth quarter of 2025.
Market analysts reacted with a range of assessments. BofA Securities raised its price target to $118, pointing to PPG’s culture of organic growth. Evercore ISI retained a $112 price target while calling out the challenges in the auto refinish business. KeyBanc Capital Markets kept a Sector Weight rating, suggesting modest EPS growth amid difficult demand conditions. Mizuho lifted its price target to $125, attributing the move to higher market multiples.
Management provided fiscal year 2026 guidance for earnings per share between $7.70 and $8.10, a range that aligns closely with consensus expectations. The guidance, combined with the company’s operational cash performance and mixed quarterly results, informed the spectrum of analyst responses and the single-point price-target moves.
Overall, JPMorgan’s target increase reflects confidence in PPG’s cash generation and revenue resilience, while the EPS shortfall and weakness in auto refinish highlight areas the company must navigate in the coming quarters.