Thursday, 19. October 2017  
30.05.2016 06:30
Author: Nic Wright

STOCK SCREEN: Industrial Stocks With Solid Margin-Of-Safety

 

 

Despite Federal Reserve Chairwoman Janet Yellen comments that a rate increase may be justified this summer, all three main indexes in the U.S. just booked their biggest weekly gains in several weeks and European stocks are on track for their best month since November.

 

While earnings estimates have been coming down consistently over the last couple of quarters there is some evidence of stabilization. Above that Global Industrial Production appears to be rebounding from severe weakness at the beginning of the year, a weakness which might have its roots in China, where imports shrunk over 14% last year. If global growth recovers, than more cyclical sectors like industrials might see a catch-up effect in their price performance.

 

In looking for ideas this week, we screen the Industrials sector for stocks with solid upside according to our fundamental fair value estimates and relative strength.

 

Here are the filter criteria:

1. Market capitalization above 1bn.

2. Upside to Intrinsic Stock Value according to our AVM’s Greenblatt inspired estimate.

3. Relative Strength over 12 months

 

Here is our list of stocks matching all criteria in alphabetical order. Company names in the table below are linked to the ANALYZER, our single stock analysis tool. Intrinsic Value Model assumptions can be adapted in the MODELER, our modeling and forecasting environment:

 

CLICK COMPANY NAME FOR DETAILED STOCK VALUE ANALYSIS

COUNTRY

INDUSTRY

LAST PRICE

MARKET CAP.

MEAN MULTIPLE UPSIDE [%]

GRAHAM UPSIDE [%]

GREENBLATT UPSIDE [%]

 AECON GROUP INC

 Canada

 Construction

17.49

1003

41.3

20.9

32.2

 GRANGES AB

 Sweden

 Metal Constructions

66.25

4945

7.4

-10.4

40.8

 IROBOT CORP

 United States

 Machinery

38.46

1056

5.7

-27.6

7.3

 ROYAL MAIL PLC

 United Kingdom

 Transportation

539.00

5390

-1.5

-26.7

3.7

 SNC-LAVALIN GROUP INC

 Canada

 Construction

52.75

7905

82.0

28.2

84.6