Although 2012 has been a tough year for industrial names, hydraulic component players like Eaton (ETN), Parker-Hannifin (PH), and Sauer-Danfoss (SHS) still post quite solid 12-month returns relative to the S&P 500; about 40% higher on average. That makes Sun Hydraulics (SNHY) a notable and surprising laggard, with the trailing year's return about 40% lower than the market. Sun stands out as a high-quality and differentiated industrial small cap, but producing an appealing fair value target takes some effort and above-average optimism.
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Can Sun's Superiority Send It Higher?