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Meritor, Inc. Message Board

  • sgkmia5 sgkmia5 Aug 23, 2012 8:12 AM Flag

    Meritor is an Undiscovered Gem

    Here is my take on Meritor...please feel free to post your thoughts.

    The earnings for FY12 will be around $1.00 and let's figure $1.15 for FY13. So we are looking at a stock trading at 4.5x Earnings. These earnings are real & they are being produced in an environment with China, India, Brazil & Europe.

    Find me another stock with that kind of valuation...heck some of these solar stocks (TSL & SPWR) have huge losses & are higher in price.

    If we get any turnaround via stimulus or just growth expansion, the earnings will grow. Remember the age of the trucking fleets are old.

    Significantly, people talk about the pension obligations. However, the new legislation that was passed in July gives companies like Meritor a huge boost. They can contribute far less than they've had to. This is a significant amount. They can use this to buy up the debt they have that is coming due in 2015.

    This stock will be at $10 by next spring.

    Good luck to all.

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