Category Archives: Industrials

Mistras Group (MG) 22Q2 Update

Mistras Group reported 22Q2 EPS of $0.15, below 21Q2’s $0.20 and my estimate of $0.18.  Revenues of $179.0 million were 0.8% above the year earlier period and also below my expectations.  While revenues were essentially flat, gross margin was lower … Continue reading

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GE 22Q2 Update

General Electric Company (GE) announced 22Q2 revenues of $18.6 billion, up 2.4% year-over-year, a GAAP loss per share of $0.59, two cents worse than 21Q2’s $0.57 loss, and non-GAAP EPS of $0.78, above 21Q2’s $0.22.  I had anticipated a GAAP … Continue reading

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GE 22Q1 Update

Since reporting disappoint 22Q1 results on April 26, GE’s stock has fallen sharply. Year-to-date, GE’s stock is down 22.6%, worse than the S&P 500 Industrial sector’s 11.7% decline.

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Mistras Group, Inc. (MG) 21Q4 Update

21Q4 Results Below Expectations, Lowering 2022 Estimates, Reducing Rating and Price Target Mistras Group reported 21Q4 EPS of $0.00, slightly worse than 20Q4’s $0.01 and below my estimate of $0.06.  Revenues of $171.2 million were 6.5% above the year earlier … Continue reading

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Mistras Group: Waiting for the Full Recovery

Mistras Group is a leading provider of non-destructive testing (NDT) and related asset protection services that monitor the condition of critical infrastructure and equipment to ensure safe and efficient operations and maximize uptime.  The company’s business has suffered during the … Continue reading

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2021 Market Outlook – Part 2: S&P 500 Sector Analysis

2020 was of course dominated by the impact of the pandemic on the economy and specifically on the revenues and profits of each of the S&P 500 constituents.  There was a sharp stock market sell-off in March-April, followed by a … Continue reading

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GE: 2020 Third Quarter Earnings Review

General Electric reported a 2020 third quarter GAAP loss of $1.16 billion or $0.13 per share on revenues on revenues of $19.4 billion, down 17%.  In the 2019 third quarter, the company reported a comparable net loss of $1.3 billion … Continue reading

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GE 20Q3 Earnings Preview and Outlook

Shares of GE have underperformed both the broader market and GE’s industrial peer group since the onset of the COVID-19 pandemic.  The weak performance reflects primarily the company’s exposure to the aviation business, which prior to the pandemic was GE’s … Continue reading

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Deep Dive on GE: Sum-of-the-Parts Valuation

As noted in a previous post, it is most appropriate to value GE as a single, stand-alone enterprise.  Several unifying investment themes support this view:

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Deep Dive on GE: GE Capital

In April 2015, partially in response to the regulatory restrictions that accompanied GE Capital’s designation as a systemically important financial institution by the Financial Stability Oversight Council, GE adopted the GE Capital Exit Plan, under which it planned to reduce … Continue reading

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Deep Dive on GE: Consolidated Enterprise Valuation

In my view, the most appropriate way to look at GE’s stock valuation is to consider the company as a single enterprise.  In this analysis, I compare its current valuation to peers.  My calculations for GE’S enterprise value-to-EBITDA multiple at … Continue reading

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Deep Dive on GE: Projected 2020 Consolidated Results

Based upon management’s guidance given at General Electric’s 2020 Outlook meeting on March 4th, I project 2020 Industrial Leverage EBITDA of $11.6 billion, up roughly 3% from 2019.  Industrial Leverage EBITDA was given in the appendix to the company’s 2020 … Continue reading

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Deep Dive on GE: The 2020 Outlook for its Businesses

Given the complexity of its business mix and financial structure, valuing GE is not an easy exercise even under benign economic conditions.  The task is made even more difficult when there is considerable uncertainty about prospects for the global economy.

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Though It Might Be Delayed, GE’s BioPharma Sale is Set to Close

GE’s stock has been battered during this sell-off, falling much more than the broader market as a whole.  Since reaching an intra-day peak of $13.26 on February 12 (roughly one month ago), the stock has fallen 40.8% to its March … Continue reading

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NYT Magazine Article on the Boeing 737 Max

The cover story in this week’s Sunday New York Times Magazine is “What Really Caused the Deadly Crashes of the Boeing 737 Max?“. While acknowledging that malfunctions caused the crashes, it also documents in detail the errors made by the … Continue reading

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United Parcel Service (UPS) 18Q1 Results

UPS reported 19Q1 EPS of $1.28, down from $1.55 a year ago. Non-GAAP EPS, which excludes the after tax impact of transformation strategy costs – i.e. costs that “will create efficiencies across the enterprise and produce higher-quality revenue growth” – … Continue reading

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Acme United Corp. (ACU) 18Q1 Results

The company reported diluted EPS of $0.24 per share, up from $0.21 a year ago.  Sales declined 1% to $31.4 million due mostly to a non-repeat of a large order from a distributor who was launching a first aid kit … Continue reading

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GE 18Q4 Results: Curb Your Enthusiasm

General Electric (GE) posted 2018 fourth quarter results that were viewed positively by the financial community primarily because there were no new major negative surprises. Although management gave an update on the company’s recent progress and certain aspects of its … Continue reading

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Acme United Battles the Headwinds

2018 was a rough year for investors in Acme United Corporation’s (ACU) stock, including CEO Walter Johnsen who owns 15% of the outstanding shares.  ACU’s 2018 total return was -38%, worse than the Zack’s Micro Cap Index’s 17% decline.  The … Continue reading

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After Earnings, GE’s Stock Hits a 9-Year Low

General Electric (GE) reported 2018 third quarter results on Tuesday, October 30.  This was the first conference call for newly-installed Chairman and CEO H. Lawrence (Larry) Culp, Jr.

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GE Part 3: Contemplating GE Capital

Besides the recent weakness at Power and Oil & Gas, GE has been grappling with legacy issues at GE Capital.  Although it has been downsizing for more than a decade now – reducing its assets from $660 billion at the … Continue reading

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GE Part 2: Assessing GE’s Value

On June 26, General Electric (GE) announced the outcome of its strategic review. Besides divestiture actions already announced, the company said that it will spin-off its Healthcare business over the next 12-18 months and distribute its 62.5% stake in Baker … Continue reading

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GE Part 1: 18Q2 Results

General Electric reported disappointing 2018 second quarter GAAP earnings attributable to shareholders of $736 million or $0.07 per share, down 30% from $1.03 billion or $0.10 per share last year.  Adjusted (Non-GAAP) EPS, according to the company’s definition, was $0.19 … Continue reading

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Notes and Analysis From GE’s Investor Update

“You can’t grow long-term if you can’t eat short-term. Anybody can manage short. Anybody can manage long. Balancing those two things is what management is”       -Jack Welch As everyone knows, this has been a tough year for GE shareholders.  … Continue reading

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Potential Implications of GE’s Latest Management Transitions

On Friday (10/6), after the market close, General Electric (GE) announced that three of its senior executives, all Vice Chairs – John Rice, CEO of GE’s Global Growth Operations, Beth Comstock, CEO of GE’s Business Innovations and Jeff Bornstein, CFO … Continue reading

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UPS Investor Day: Invest. Grow. Deliver.

UPS held an investor day in New York City on February 22, three weeks after reporting disappointing fourth quarter results.  Its stock fell sharply on the earnings news, giving back all of its Trump rally gains.  So far this year, … Continue reading

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Covanta’s Dividend Boost Now Faces a Test

Covanta Holding, through its subsidiaries, is the largest owner and operator of Energy from Waste (EfW) facilities in the U.S. The company accepts waste from its customers, mostly municipalities, and burns it to produce electricity. It also recovers iron and … Continue reading

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