Air Products Shares Fall 6% on $8B Project Talks, Affirms 2026 EPS
Air Products shares dropped over 6% after announcing advanced talks with Yara on an $8 billion Louisiana gas project and Saudi renewable ammonia plan, while management reaffirmed 2026 adjusted EPS guidance of $12.85–$13.15. Trading at 18.7x next-twelve-month earnings and yielding 2.9%, Air Products plans $4 billion capex in 2026 declining thereafter.
1. Advanced Talks with Yara International
Air Products is in advanced discussions with Yara on an $8–9 billion Louisiana industrial gas complex, targeting a final investment decision by mid-2026 and completion by 2030. In Saudi Arabia, Yara is negotiating marketing rights for renewable ammonia tied to the NEOM Green Hydrogen Project, with supply expected to begin in 2027.
2. Reaffirmed 2026 Earnings Guidance
Management confirmed adjusted EPS guidance of $12.85–$13.15 for 2026, implying 7–9% growth over the prior year, and stated these projects will not alter previously issued forecasts despite ongoing helium market headwinds.
3. Capital Expenditure and Cash Flow Outlook
Air Products projects approximately $4 billion in maintenance and growth capex in 2026, declining to about $2.5 billion annually as major builds conclude, which is expected to bolster free cash flow generation.
4. Valuation, Dividend Yield, and Price Target
Trading at 18.7x next-twelve-month earnings and 15.5x 2028 consensus EPS, Air Products offers a 2.9% dividend yield with 43 consecutive years of growth. A $360 price target implies roughly 31% upside from current levels.