I will grudgingly accept that it sometimes makes sense for investors
to pay up for quality, but it is still a hard pill to swallow at times.
In the case of Atlas Copco (OTCPK:ATLKY), I can't feel too bad about calling them a little pricey back in February,
as the shares fell more than 10% from that point until a strong rebound
after second quarter erased a chunk of that underperformance.
Atlas
Copco remains a very good company, with leading positions in
compressors (used throughout manufacturing and many other end markets),
underground mining equipment, and certain segments of the industrial
tool and construction equipment markets. What's more, margins are solid
and the company has made a point of emphasizing its parts and
aftermarket service businesses. The hang-up for me remains price, as
Atlas Copco's quality has thus far kept the shares from selling off all
that much.
Read more here:
Atlas Copco's Frustrating Quality-Value Conundrum
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