APD: Capital Deployment Kickoff; Raising Numbers on Lu'An JV
|Date:||September 11, 2017|
|Authors:||Kevin W. McCarthy, Sandy H. Klugman, Matthew DeYoe|
|Rating:||Hold (at time of publication)|
|Company:||Air Products and Chemicals, Inc.|
|Price Target:||$ 148.00 (at time of publication)|
Let the capital deployment begin! Air Products announced on Sunday a new $1.3bn, 60%-owned JV with Lu'An Clean Energy for production of coal-based synthesis gas in China (syngas is a combination of hydrogen and carbon monoxide or "CO"). We view the move as strategically sensible and consistent with hints dropped on the company's F3Q17 earnings call on 1 August. While investment of the company's excess capital is a highly anticipated event, we would nevertheless expect APD shares to perform relatively well on today’s session based on forward progress.