Industrial gas producer and supplier, Praxair Inc’s (PX) subsidiary, Praxair China announced opening of a new air separation plant in Nanjing, Jiangsu province. The news follows the announcement of commercial opening of an air separation plant in Wuwei, Anhui province last week.
The plant at Jiangsu province with a daily capacity of 1,700 tons will supply industrial gases including oxygen, nitrogen and argon to Meishan Iron and Steel Co., Ltd. The latter is a group company of one of the prominent steel producers in the world, Baosteel Group.
A series of contracts won by Praxair China of late clearly signifies the growing preferences among customers for the company’s technology, products and gas supply services, while Praxair China’s joining forces with Meishan further strengthens their decade-long commercial relationship.
In June 2012, Praxair China signed a long-term gas supply contract with China-based Yankuang Guohong Chemical Co., Ltd. and Yankuang Group, one of the largest coal exporters and producers in China.
The current Zacks Consensus Estimate for the second quarter of 2012 is $1.42, representing a year-over-year increase of 3.14%. Estimates for the fiscal years 2012 and 2013 are $5.79 and $6.60, reflecting annual growth of 6.71% and 13.83%, respectively.
Praxair is slated to release its second quarter 2012 financial results on July 25, while its prime competitor, Air Products & Chemicals Inc. (APD) is expected to release its third quarter results on July 24, 2012.
We maintain a Neutral recommendation on Praxair. The stock also carries a Zacks #4 Rank, implying a short-term (1-3 months) Sell rating.
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