Radical investors apply pressure! Air Products announces nomination of two independent directors

Seifi Ghasemi, Chairman, President, and CEO of Air Products, stated: “We are pleased to nominate Bob and Alfred to the Air Products Board of Directors and welcome their extensive business experience and seasoned leadership.” He also expressed gratitude to David and Matthew for their service and contributions to Air Products. Air Products faces pressure from activist investors Air Products is facing mounting pressure from hedge fund managers Mantle Ridge and D.E. Shaw, who have criticized the company’s underperforming stock, senior leadership, and capital allocation policies—and urged a board overhaul to enhance management dynamism and refocus on core business operations. In October, activist investors Mantle Ridge and globally renowned hedge fund D.E. Shaw separately announced they had collectively acquired $1 billion worth of Air Products shares, calling for cost reductions, a sharper focus on core businesses, and paving the way for new leadership. The two activist investors share a common goal: pressing Air Products to establish a clear succession plan for its 80-year-old incumbent CEO, Seifi Ghasemi—one of the oldest CEOs among S&P 500 component companies. Earlier, Reuters, citing informed sources, reported that Dennis Reilley and Eduardo Menezes—both former executives at Linde—would join Mantle Ridge’s campaign to restructure Air Products’ management and board. D.E. Shaw has targeted several of Air Products’ major transactions, noting that the company has launched multibillion-dollar hydrogen projects lacking “off-take agreements,” exposing them to significant risk. In another letter issued in September, D.E. Shaw pointed out that Air Products’ clean hydrogen strategy has eroded approximately $15 billion in equity value from its core industrial gases business. Anticipating governance reform, investment banks upgrade Air Products’ stock rating and price target Expecting activist investors to play a constructive role in advocating corporate governance reform and strategic realignment, investment banks have upgraded Air Products’ stock ratings and price targets. Mizuho Securities raised its price target to $360; Jefferies upgraded its rating to “Buy” with a $364 target price. Evercore ISI also upgraded its rating to “Outperform” and raised its price target to $365. BMO Capital maintained its “Outperform” rating with a $323 target price, while Citigroup raised its target price to $345. Regarding stock performance, Air Products has trailed the S&P 500 Index for two consecutive years. However, following the entry of activist investors, its share price has shown strong momentum recently. As of Monday’s (November 18) close, Air Products rose 3.4% to $327.89, with a market capitalization of $72.8 billion. Year-to-date, the stock is up 20%, still below the S&P 500’s同期 gain of 23.5%.

Air Products’ sales decline in fiscal Q3 2024

For fiscal Q3 2024 (ended June 30), Air Products reported sales of $3.0 billion, down 2% year-on-year. Under U.S. GAAP, net income totaled $709 million, an increase of 16% year-on-year, driven primarily by favorable pricing and business mix. GAAP net profit margin stood at 23.7%, up 360 basis points year-on-year. In Q3, non-GAAP adjusted earnings per share (EPS) amounted to $3.20, up 7% year-on-year. Adjusted EBITDA was $1.3 billion, with an adjusted EBITDA margin of 42.4%, up 260 basis points year-on-year. Sales declined across all global regions during the quarter. Sales in the Americas totaled $1.2 billion, down 2% year-on-year. Sales in Asia reached $790 million, down 4% year-on-year. In Europe, sales fell 2% to $693 million.

Nineteen Analysts Set USD 333.88 Target for Air Products Stock

5 days ago

Nineteen brokerages set an average 12-month price target of USD 333.88 for Air Products, 8.32% above current levels. Investors await Q4 fiscal results on November 5, focusing on gas volumes and pricing to offset project-exit costs.

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Nineteen Analysts Set USD 333.88 Target for Air Products Stock

Nineteen Analysts Set USD 333.88 Target for Air Products Stock

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