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NN Inc. Message Board

  • persurfer persurfer Aug 29, 2011 11:34 AM Flag

    NNBR (pe=5) vs ROLL, KDN, KAMN, CIX,TKR

    The peers trade with pe ranging from 10 to 22.

    Actually TKR has only pe around 10-11 currently.
    All the other peers trade with pe 15 and higher.
    Why does NNBR trade with pe = 5 currently ?

    NNBR will make about 1,40- 1,50 $ eps for 2011.
    NNBR have facilities all over the world. They are not dependent on the US growth. They have facilities in China and Eastern Europe too. The facility in Arizona will be slightly profitable in Q3.

    It does not make sense to me why the supposedly US recession, IF IT HAPPENS, will impact NNBR with the globalized and worldwide network of factories, but it will not impact the peers which keep trading with double digit pe.

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    • Same thing in China where NNBR has one of its factories.

    • In addition, the conservative CEO keeps saying that he does not see any impact on NNBR results from the supposedly decrease , if any, at the US growth in H2 2011, and things are going fine for the remainder of the year.

      Roderick R. Baty, Chairman and Chief Executive Officer commented, "Our second quarter and six months revenues for each of our three businesses, Metal Bearing Components, Rubber and Plastic Components, and Precision Metal Components continued to experience good levels of demand and are well ahead of 2010 levels. We are pleased that our second quarter and first six months earnings from normal operations represented historic records given the significant start-up costs we experienced at our Whirlaway operation. Although we have made incremental quarter over quarter improvements in these costs, they resulted in a loss at Whirlaway of $2.2 million in the first quarter and a loss of $1.1 million for the second quarter of 2011. We continue to make progress on the start up manufacturing issues and expect Whirlaway to reverse the first half losses and operate slightly above breakeven levels for the second half of the year."

      "Although the levels of customer orders and our forecasts continue to reflect solid revenue growth over 2010, the rate of incremental quarter over quarter growth is expected to level out in the second half of the year. Given normal second half seasonality in our businesses, particularly in Europe, we expect revenues to be slightly lower in the second half of 2011 compared to the first half of 2011. However, we are currently forecasting good levels of demand continuing for the second half of the year with corresponding high levels of capacity utilization in each of our global manufacturing operations."

      "Previously, we provided revenue guidance for full year 2011 of $420 million to $425 million. We now expect full year revenues to be in the range of $435 million to $440 million. A significant amount of the increase in our full year revenue guidance is due to foreign currency exchange rates and the revenue impact of material price inflation pass through. Our full year revenue guidance assumes good demand in the second half of 2011 continuing and is based upon current orders from our customers. Since we have seen no immediate impact on our business, our guidance does not reflect any recent concerns associated with weakening global economic activity for the remainder of 2011."

      I really do not get the current valuation of NNBR when the peers are valued much much higher. NNBR should have a 2011 pe =15 minimum currently to cover the huge gap with the peers.

21.19+0.06(+0.28%)Nov 26 4:00 PMEST

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