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Oshkosh Corporation Message Board

  • cpasific cpasific Aug 12, 2010 9:50 AM Flag

    Below $20 coming soon

    watch for a sudden drop

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    • I'm new to these boards and am trying to learn more about how the market works. I see a current DJIA range of about 9800 to 10500 with swings based on sentiments of the moment. OSK shows great earnings and a wonderful P/E. What is your reasoning for a sudden drop?

      • 2 Replies to hgl12692529
      • I'll take a stab at giving you an objective answer to your question (just my opinion, however). Essentially, the market is discounting future earnings because the company isn't providing much in the way of guidance. The market perception of OSK is that it is currently a one trick pony. That trick is defense. While defense has been a stellar performer for the past 15 months, that well is drying up. The MATV program is nearing completion and basic defense spending will be down significantly in the coming years. The fire and rescue business has been a consistent performer until last quarter when its sales were off 18%. This business is heavily dependent upon state and local government purchasing. Most people believe the recent drop in sales is a harbinger of things to come. Other aspects of the business (aerial equipment, concrete placement) are heavily levered to non-residential construction. There is no sign of a recovery in that business. The refuse business is very cylical with low margins. Finally, they are still strapped with close to $2 billion in debt as a result of the ill timed JLG acquisition. So, what E in 2011 is going to support the P? Listen to the conference call and decide for yourself if there was any positive guidance. In the past, I've been a buyer of OSK and a seller. Right now, I'm neutral. If the economy gets much worse, I'd look for this to go into the mid-teens at which point I'd be a buyer.

      • no more govt contracts for military vehicles and municipalities cannot afford their trucks now.

 
OSK
54.82+0.18(+0.33%)May 22 4:02 PMEDT