This is old news that even the company acknowledged would occur in 2013. JOY is executing well at managing costs and still maintaining strong profitability. Forward 2013 p/e is only between 9 and 11 based on their projected $5.75 to $6.35/per share 2013 earnings. Any turn in coal and JOY is quickly in the $90s.
But an investor needs to understand that the more important measure for Joy would be the pace of order inflow, and not revenue and earnings. Say, for 2013, Joy’s top line might still look healthy even if there aren’t many new orders. That’s because the company doesn’t deliver as soon as it books. Caterpillar’s last-quarters numbers are a perfect example. Sales for its Resource Industries’ (mining) business was up 14% from the year-ago quarter, but new orders didn’t match up to last year’s levels.
Joy already has enough orders in hand carried over from earlier year(s) that will take care of 75% of its total projected 2013 production. So the real test for Joy, and the mining industry as a whole, would be to see how many new projects are flagged off by mining majors this year.