Morgan Stanley analyst Vincent Andrews maintained a Hold rating on Air Products and Chemicals today and set a price target of $290.00.
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Vincent Andrews has given his Hold rating due to a combination of factors surrounding Air Products and Chemicals. The recent significant drop in the company’s share price, nearly 10%, compared to a smaller decline in Linde’s shares, has raised questions among investors. While some view the decline as an overreaction, others are cautious, noting that the valuation gap with Linde is not at its widest, and thus, it might not be the right time to buy.
Additionally, there is uncertainty regarding the company’s Louisiana project, with investors expecting a decision by the end of 2025. However, the decision has been postponed to mid-2026, along with an increase in the project’s capital expenditure estimate. Concerns about the return on investment and the lack of clarity on the project’s earnings contribution also contribute to the Hold rating. Investors are wary of the high costs associated with the project and the potential for budget overruns, which are common in US ammonia projects.