— Jeff Ward, Lehigh Valley News Briefs
Air Products and Shift4 had some drama in 2024, while PPL kept chugging along and may benefit from the potential Artificial Intelligence boom.
Locals who owned these Lehigh Valley companies for the entire year did alright in 2024 but consider that the S&P 500 gained 24%, holding an index fund would have been a good move too.
OraSure meanwhile continued to destroy shareholder value.
Air Products faces a proxy battle, with an activist investor challenging Chief Executive Seifi Ghasemi’s vision of the company as a leader in a global transition to clean energy.
Investor Mantle Ridge wants a succession plan (Ghasemi is 80) and a focus on the company’s traditional industrial-gas business. Ghasemi has been moving into “green hydrogen,” which refers to the process of making the gas from water using renewable energy. That process does not generate carbon dioxide emissions. CO2 is a greenhouse that is linked to climate change.
Mantle Ridge is seeking votes in favor its board nominees, while Air Products say it is progressing and wants to stay the course. Mantle Ridge says shares of Air Products could be at $425 with a different strategy and focusing on its traditional markets.
Shifts of Air Products (NYSE:APD) finished 2024 at $290.04. That’s up from $272.64 at the end of 2023, but below the $337.00 high in 2024 that came after the battle over the company’s future started. Air Products also pays a $1.77 dividend quarterly.
The issue will be settled at the annual meeting of shareholders on Jan. 23. Right now, my view is Air Products will prevail over Mantle Ridge. Still, change might be accelerated under investor pressure.
Shift4, the payment-processing company based in Upper Saucon Township, had a big year, as did its investors. Shares in the company (NYSE:FOUR, no dividend) ended last year at $103.78, well up from the $74.34 closing price of 2023.
In December, Shift4 announced that founder and Chief Executive Jared Isaacman has been chosen to run NASA. Isaacman is a pilot and has been to space twice on private SpaceX missions. He is also worth about $2 billion, based on estimates from Forbes.
The stock dipped a bit on the news but bounced back. Based on conference calls, President Taylor Lauber and Chief Financial Officer Nancy Disman are on board with Isaacman’s strategy of profitable growth, that is, not losing money just to gain market share.
Shift4 processes credit payments for restaurants, hotels, sports arenas and and other businesses, and has been expanding its reach. Its headquarters is local but its reach is national and becoming global.
PPL, the Allentown-based utility, had a less dramatic 2024 but with a solid gain. The shares (NYSE:PPL) closed Dec. 31 at $32.46, up 24% from the end of 2023. PPL also paid $1.04 in dividends in 2024.
The company may be an energy utility, which isn’t supposed to be exciting, but PPL may gain lots of business with an Artificial Intelligence boom. AI requires immense amounts of energy, and PPL Chief Executive Vincent Sorgi said the company has been in talks about data centers being built in its service area.
Meanwhile, OraSure (NASDAQ:OSUR) had a lousy year, finishing at $3.61, less than half of the $8.20 per share value at the end of 2023. The company does not pay a dividend.
Management of the South Bethlehem-based maker of diagnostic tools has pointed to cash flow and its debt-free status as bright signs, but perhaps the company has no answered the big question yet: What is its role after the pandemic?
During the COVID-19 pandemic, OraSure received millions of dollars from the federal government. Since then, revenue has plummeted. That was not expected, but it’s still not good news.
OraSure recently made a small transaction ($5 million, with perhaps another $20 million in milestone payments) for a firm that is working on tests for sexually transmitted diseases. Based on the stock reaction, the market was not impressed.
Among companies that are not based in the region but have big operations here, Thermo Fisher Scientific finished the year at $520.23, down from the $529.35 final 2023 price. Thermo (NYSE:TMO) also paid $1.56 in dividends over the year.
Prologis (NYSE:PLD) may not be a household name in the Valley but the Real Estate Investment Trust (REIT) controls about 30 million square feet of local warehouses.
The 2024 closing price on Tuesday was $105.70, down from $129.25 at the end of 2023. The company paid $3.84 in dividends over the year, so total return was still negative.
Prologis was chosen as the developer of warehouses at the old Air Products campus in Upper Macungie, but that fell through, at least for now.
So that’s a quick look at some of the big and small companies that are based in the region or have big operations here.
Disclosure: I shop at home, so I own shares in Air Products, PPL, Shift4, Thermo Fisher and Prologis. Overall, I’ll stick with most of them in 2024, as of now.
Lehigh Valley News Briefs 