Wednesday, November 27, 2013

Seeking Alpha: Harsco Already Getting Some Benefit Of The Doubt

It has been a rough road for Harsco (HSC) over the last two years. While the stock has rebounded some already (up about one-third from its mid-November 2012 lows) on hopes that better days are ahead, the company's sluggish-to-poor revenue, margin, and free cash flow performance since 2009 reflect the challenges in both the global steel market and infrastructure/construction markets.

I do think better days could be on the way. Steel mill utilization in Europe seems to be past its trough and Harsco has been actively turning its focus toward emerging markets. At the same time, management found a good home for the Infrastructure business and has the opportunity to leverage its Industrial and Rail businesses into larger contributors. I have some concerns that the market has been too quick to assume that Harsco's turnaround plans will work (we've heard it before from this company), but I can't argue that a recovery could ultimately take these shares into the $40s down the line.

Please click below for more:
Harsco Already Getting Some Benefit Of The Doubt

No comments: