PPG Industries (NYSE:PPG) shares fell nearly 2% today after BofA Securities lowered its rating on the stock from Buy to Neutral and cut the price target to $126 from $143, citing a growing mix of macro and sector-specific headwinds.

While overall coatings raw material inflation is expected to remain relatively contained through 2025, the firm projects a more noticeable price uptick by 2026—driven in part by escalating costs for tin plate and epoxy resin. These pressures are being amplified by anticipated mid-single-digit inflation in raw materials, compounded by tariff-related impacts.

PPG’s recent sale of its U.S. and Canadian architectural coatings business reduced its exposure to North American housing, but its Mexico-based Comex segment could face indirect pressure if tariffs slow the Mexican economy. Meanwhile, PPG’s automotive OEM and refinish segments may be vulnerable in a potential downturn, given their sensitivity to consumer demand.

With inflation risks climbing and economic uncertainty rising, BofA believes the near-term upside is now limited, prompting its shift to a more cautious stance on the stock.