Equity Research
Barclays Capital does and seeks to do business with companies covered in its research reports. As a result, investors should be
aware that the firm may have a conflict of interest that could affect the objectivity of this report.
Investors should consider this report as only a single factor in making their investment decision.
PLEASE SEE ANALYST(S) CERTIFICATION(S) ON PAGE 3 AND IMPORTANT DISCLOSURES BEGINNING
ON PAGE 4
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Investment Conclusion
We will host a conference call on Tuesday, April 6, @ 11:00 AM EDT to discuss our Q1'10 preview of the US chemical stocks: DOW, DD,
CE, PPG, PX, APD, SHW and others. Please contact your Barclays Capital equity salesperson for the dial-in number and passcode.
Summary
"1Q’10 = An unusually NORMAL Quarter" - After 6 quarters of highly volatile and often unpredictable results, this quarter is expected to
be fairly normal in terms of sequential changes in prices, volumes and profits. Certainly, y-o-y values will be large and positive (given a
very depressed comparison base of 1Q’09), but this time and for all of 2010, we believe sequential changes are far more important.
Top Picks for 2010: We favor CE, DOW, and PPG, due to relatively higher leverage to economic growth and Asian end markets and
permanently reduced cost base, which should lead to margin upside. In addition, we like APD and PX, which should benefit from growth
in global economies (>2x IP leverage), along with growth in energy and ‘green’ related technologies
To calibrate expectations for the upcoming 1Q'10 reporting season, we will preview the recent and near-term future chemical
trends on our conference call on Tuesday April 6 at 11:00 am ET. Please contact your Barclays Capital equity salesperson for the
slides and dial-in info.
We will discuss the following topics:
•
“1Q’10 = An unusually NORMAL Quarter” After 6 quarters of highly volatile and often unpredictable results, this quarter is expected
to be fairly normal in terms of