) to strong buy from hold after the Federal Reserve's recent interest rate cut, which should help spur economic growth.
PPG shares rose 2-5/8, to 48 1/8, after Young's report.
Investors view the company as an early cycle stock, Young said, but the recent 50 basis point reduction in short-term interest rates should accelerate interest in the cyclical chemical group. He said the company's highly regarded management team has a history of not overpaying for acquisitions and successfully integrating these businesses.
Young expects earnings per share of 2000 to come in at $3.75 and 2001 EPS to come in at $3.50. He sees peak EPS at $6.20 in 2003. In 18 months, the shares could reach the $65 to $70 range, which is equal to P/E and EV/EBITDA ratios of 10.5, 5.7, respectively.