Rush is a great company but RUSH.A and .B have been terrible stocks lately.
Yesterday they announced a renewal of their stock buyback program which should put a floor under the price at these levels. Upcoming EPS should meet estimates and looking ahead a year or so, I think we'll be pushing $40.
Company could do a few more institutional presentations to get the word out but that's just my opinion.
we may son move to the $55-57 range. Good prelim rev and EPS announcement the other day...and pre-guidance for last two Qs of F/Y 2015.
Now, if we could only get the Fed inquiry out of the way, I think we could see an 18+ multiple on this stock.
Here's something else to think about. Once the Fed inquiry is out of the way...and with LCI's pipeline (25 new drugs between now and F/Y '19, we may become an acquisition target.
My comment on the pathway to $40 was predicated on TA in which a large void exists in the share price between about $32 and $42. I didn't say it would be easy nor did I say it would be immediate. I did say that that we first have to clear resistance in the $29-30ish area....and that may take a few weeks to a couple of months as I still believe oil is in a bottoming process and if investors wait for a clear turn in the price of oil, energy-related stocks will already have made substantial moves to the upside..
Sentiment: Strong Buy
Double bottom in and that showed a successful retest. Once we clear $29-30, path looks pretty clear to near $40.
Oil may be bottoming. There is a lot of blood in the streets...a good sign for adding at these levels. Stocks typically move before fundamentals so oil can flop around between $42-$46 for six months while energy stocks begin to move up.
Let me try my reply again. Q 1 was .$94....Q 2 was just indicated to be between $1.18 and $1.21. The Company guided that Q's 3 and 4 should match Q 1.
$.94 + $1.20 + $.95 and $.95 add to $4.04.
Yesterday's guidance suggests that the company may book something north of $400 MM in revenues and EPS right around $4.00 in the 2015 June F/Y. The gains would amount to 45+% in revenues and 100+% in EPS.
With 45 new products on the launch pad, and no acquisitions figured in, the company's 2019 F/Y forecast of $590 MM in revenues will likely scale up to around $650 MM and still be a conservative estimate. The trick is estimating earnings as margins will seemingly have to compress after this year's blowout numbers. I am still of the opinion that LCI will use some of its substantial cash reserves to make accretive acquisitions...which should boost revenues further and give the company a decent shot at doubling EPS by that time.
The big imponderable is the Federal inquiry into price collaboration. My best guess is that this will go away with no significant harm to the company.
The lifting of that latter cloud ought to bring the multiple up to a more expected 18-20 times. At $4.00 in EPS six months from now, the math looks promising for some added upside.
As I recall when I did the research a few months back, LCI has a very long-term record of growing their business at what I recall was about 27% per year. That type of return would appear to be do-able in the next several years as well....but time will tell as it always does.
For now, I remain long and watching as always.
The guidance issued was for the second Q ending December as the company is on a June FY.
Regarding an update on the Federal investigation. Typically, the Feds do NOT keep their targets updated on the status of any action against them. Because the investigation is a "material" matter, the company will be obligated to offer an update when any new information comes to their attention. In the absence of any information from the Feds, the company is wise to say nothing....the assumption we can all make is that the "company is cooperating fully with the Federal investigation and maintains it has done nothing wrong."
will be too late. First of all, in order to determine that oil has "bottomed," one would have to see a significant rebound off the previous bottom...and, by that time, stocks of energy and energy-related companies will be up significantly as it's been shown time and time again that stocks bottom (or top out) before changes in fundamentals.
My bet is that oil will "bottom" within the next six months (if it hasn't already bottomed) and that energy-related companies are at or near their ultimate bottoms.
With SLCA down almost 70% and possessing sound fundamentals, I placed my bet two day ago under $25.
Yes, I bought yesterday under $25...so here's my thinking as a long-term investor....if you're a trader, you can ignore this message.
Who knows where oil will bottom out. I'm "guessing" low $40's but that's less important than my thinking about SLCA getting through this mess. They are adding some debt...they are buying back some shares...a few insiders are nibbling. So, why the debt? There will very likely be a consolidation among the sand merchants and having the capital to gobble up the weaker industry participants will be a bonus when we again surface in 1-2 years. The players will be fewer, pricing will be better. SLCA has the logistics and the margins to compete as well as anyone in this space and their added capital suggests to me that they will be even better able to compete/be stronger as we move forward. I see their market share increasing by more than the 1-2% each year they are forecasting, though even that rate is decent....but if they take out weak competitors and acquire more assets along the way (sand), their market share will grow even faster. I believe they have a 10% market share now in a highly fragmented industry...and I see their share growing to north of 20% within less than 10 years.
My take on the share price: looking out 1-2 years. Yes, there is the possibility of another price haircut, maybe down to $20 (which is where I would add to my position should be get there) but I value the upside at around $50. so, 20% downside---vs 100% upside...I'll take those odds any day.
Just my thoughts.
Actually, when I get the opportunity, I do "follow" Cramer. When he really unloads on a stock, I am ready to buy and when he's loves a company, I look for the exit. Works enough times to keep me happy investing.
BTW, and purely by coincidence, I bought some SLCA earlier today; Cramer's late afternoon rant just reaffirms the wisdom of my pick.
Let me also add that I am not a trader but a patient long-term investor. SLCA will be fine but I'm looking out 2-5 years when oil is back in vogue. Today looked to be a classic "blood in the streets" day with respect to energy and energy-related companies.
One thing for certain is that MIDD is broadening and deepening the moat around its business. At the end of the day, this places a higher value on the company....whether it remains a stand alone company or chooses to sell out.
The Bakers are always working on deals...the one that at some point will involve SGEN will likely be a blockbuster based on their continued accumulation of shares and the large position they have in this stock. They are NOT buying to support the share price but, rather, to make a down payment on a huge payday.
Correct on the filing data. The question is, what is the Baker Bros's strategy: hold on for appreciation or orchestrate a buyout?
Looks to me like there's some great data in the pipeline (courtesy of some excellent blockbuster drug candidates). At the point at which value can be optimized, whether by market appreciation or by some large pharma stepping up with a bid to take out the company, the BB's will have scored another home run.
Judging by their position in this stock, relative to their other holdings, they must have supreme confidence in SGEN leadership to steer the company in the right direction.
This appears to be a new suit. The Feds saw the CT. state suit and thought: "why are we missing out on this action?" In all likelihood, this too will be resolved without any meaningful damage to the company....after all, this suit claims to be against the industry, not just LCI....so I cannot opine about if any of LCI's competitors are at risk.
I should point out that LCI has acknowledged the ability to hike prices as competitors drop out of the marketplace....nothing wrong there. Also, the company is relatively unique in that they are allowed to deal with so-called "controlled substances" and I would think they have been very careful in this area so as to avoid any undue criticism.
Aside from a very respectable EPS report Selim Bassoul (MIDD's CEO) on today's call reiterated what I took to be the best long-term driver for this company when he said that by 2020, half of all restaurant kitchen operations will be automated. The magnitude of this number and its impact on MIDD has to be staggering and reinforces the longer-term growth story as MIDD is the leader kitchen equipment supplier to the vast majority of larger QRS and casual restaurants. As minimum wages continue to escalate across the country, MIDD's value proposition gets stronger each day.
Note that MIDD included $6+ MM from a "gain on litigation settlement" in the report. In doing my analysis, I've opted to back this number out of their statement. After making this adjustment, I still get an excellent EPS beat of $.94 us an expected $.86.
I remain long and while $105 would be great to see today, I'd be happy to see the stock at $95 or thereabouts in the near term. MIDD remains a core holding in my portfolio. Be interesting to hear the company's comments on today's CC.
It's no surprise to me that, after a 50% up move in the last 3 weeks and a strong EPS report and strong guidance, we shouldn't have a 10-15% correction. This, too, shall pass....IMHO.
The company gave guidance with today's EPS report. Taking the worst and best cases (the lowest sales estimate, the lower gross margin, the highest R & D and SG&A, tax rate on one hand and the highest sales estimate, higher gross margin, lowest R & D, SG&A and tax rate on the other hand....and using 39 million shares, I get an EPS estimate range of between $2.96 and $3.50 for FY 2015 (June).
If the company has a decent handle on what they're doing, I think full year 2015 FY estimates will/should begin to scale up to at least $3.25.
Put a 25 multiple on this number by the end of next quarter (Dec 2014) and I get a target price of $81+....pretty much in line with what I've suggested earlier that LCI should/will be an $80 stock.
Just my $.02