FOE (Update)

Ferro Corporation

Industrial/Transportation


Presented:04/28/2014
Price:$13.12
Cap:$1.14B
Current Price:$22.01
Cap:$1.84B

Presented

Date04/28/2014
Price$13.12
Market Cap$1.14B
Ent Value$1.47B
P/E Ratio12.78x
Book Value$3.73
Div YieldN/A
Shares O/S86.92M
Ave Daily Vol790,000
Short Int1.62%

Current

Price$22.01
Market Cap$1.84B
Ferro Corporation, together with its subsidiaries, produces and sells specialty materials and chemicals in the United States and internationally. The company operates in five segments: Pigments, Powders, and Oxides; Performance Colors and Glass; Performance Coatings; Polymer Additives; and Specialty Plastics. It offers various performance materials, including frits, porcelain and other glass enamels, glazes, stains, decorating colors, pigments, inks, polishing materials, specialty dielectrics, electronic glasses, and other specialty coatings; and performance chemicals comprising polymer additives, engineered plastic compounds, and pigment dispersions. The company’s products are used in appliances, automobiles, building and renovation, electronics, household furnishings, packaging, and industrial products. It sells its products primarily to the manufacturers of ceramic tiles, appliances, construction materials, automobile parts, glass, bottles, and wall coverings directly, as well as through agents and distributors. Ferro Corporation was founded in 1919 and is headquartered in Mayfield Heights, Ohio.

Please note, this is an update to Long — Ferro Corp (FOE), which was originally presented on 7/8/2013, at $6.40.

Highlights

Shares of Ferro (FOE) have performed well since the presenter reviewed his bullish thesis in early July, 2013. At ~$13 today, he still sees 40% upside for the small cap performance materials/ chemicals company. He quickly recapped that FOE was nearly bankrupt one year ago due to their solar exposure. The new management team has done an excellent job with both the turnaround of the business (getting rid of solar removed a big earnings drag) and managing Street expectations. FOE has been on a “steady earnings beat trend spanning the past five quarters,” said the presenter, and he remains long the stock.

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Idea Discussion

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