We recently published a list of 11 Undervalued Chemical Stocks to Buy Now. In this article, we are going to take a look at where PPG Industries, Inc. (NYSE:PPG) stands against other undervalued chemical stocks to buy now.

President Trump is looking to place 25% tariffs on goods from Canada and Mexico and this could negatively influence US industries and critical sectors beyond just autos. According to a report by CNBC in January 2025 by Lori Ann LaRocco, Canada is the largest partner with the US for critical chemicals.

READ ALSO: 15 Best EV Stocks To Buy According to Billionaires and 10 Best Stocks Under $10 to Buy Now.

The US chemicals industry also exports a huge amount of products to Canada. In 2023, US firms sold over $28 billion in chemicals to Canadian customers. On the other hand, Canadian partners export approximately $25 billion in chemicals to the US annually, as per the American Chemistry Council.

Texas, California, Louisiana, North Carolina, Illinois, Ohio, Indiana, New York, Pennsylvania, and Iowa are the top chemical-producing states and they account for about 66% of total US chemical production while the rest of the chemicals are imported. According to the American Chemical Council, Canada is the leading source of chemical imports to the US and accounted for 18.1% of the total chemical imports in 2023. Canada is followed by China and South Korea.

Eric Byer, CEO of the Alliance for Chemical Distribution, pointed out that if there is a trade war between Canada and the US, the price of critical chemicals could lead to inflationary pressures on US consumers and industries. According to Byer, Canada exports approximately 80% of the chlorine used in disinfecting drinking water for the West Coast states. He also pointed out that the US exports large amounts of phenol to Canada for use in the wood products industry. Some of that treated lumber is then also exported back into the US from Canada for domestic consumption and home construction purposes.

The US-Canada chemical trade relationship supports other industries as well and disruption of this trade between the two countries could have far-reaching consequences.

Our Methodology

To compile our list of the 11 undervalued chemical stocks to buy now, we looked for the largest chemical companies. We reviewed our own rankings, financial media reports, ETFs, and various online resources to compile a list of the best chemical stocks. To find undervalued chemical stocks, we narrowed down our selection by looking for stocks trading at under 20 times their forward earnings as of March 28, 2025. Next, we focused on the top 11 undervalued chemical stocks most favored by institutional investors. Data for the hedge fund sentiment surrounding each stock was taken from Insider Monkey’s Q4 2024 database of more than 1,000 elite hedge funds. Finally, the 11 undervalued chemical stocks to buy were ranked in ascending order based on the number of hedge funds holding stakes in them as of Q4 2024.

Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

A close-up of an artist carefully applying a coat of paint to a wood structure.

PPG Industries, Inc. (NYSE:PPG)

Forward P/E: 13.64

Number of Hedge Fund Holders: 36

PPG Industries, Inc. (NYSE:PPG) is an American multinational chemical company and a leading global supplier of paints, coatings, and specialty materials. With operations in more than 70 countries, the company serves customers in construction, consumer products, industrial, and transportation markets and aftermarkets. PPG Industries, Inc. (NYSE:PPG) ranks among the best-undervalued chemical stocks to invest in.

The company is strategically streamlining and optimizing its business by divesting some of its assets while also investing in growth initiatives in certain markets. In 2024, PPG Industries, Inc. (NYSE:PPG) optimized its business portfolio through the divestitures of its silica products and its architectural coatings US and Canada businesses. These divestitures improved the company’s financial profile and helped the company to improve its EBITDA margin to 18.1%. This move also helps PPG Industries, Inc. (NYSE:PPG) to focus more on core strengths and deliver sustainable organic growth. On March 26, 2025, PPG Industries, Inc. (NYSE:PPG) announced the opening of a new waterborne automotive coatings manufacturing plant in Samut Prakan, Thailand. The facility will produce waterborne basecoats and primers with a production capacity of 2,000 tons annually. The facility includes an automated spray application center that will enhance PPG Industries, Inc.’s (NYSE:PPG) service capabilities. The rise of electric vehicles in the region presents vast opportunities for global automakers, including Chinese OEMs. This move will expand the company’s operations and help the company meet the rising demand for coatings from automotive companies in Southeast Asia.

Overall, PPG ranks 6th on our list of undervalued chemical stocks to buy now. While we acknowledge the potential of PPG, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than PPG but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.

Disclosure: None. This article is originally published at Insider Monkey.