Seeking Alpha: Colfax's Benefit Of The Doubt Has Deservedly Gone Away

I have openly granted the growth potential of Colfax (NYSE:CFX), but I haven't ever really liked the valuation that the Street was willing to give the stock. While investors and analysts have expected a lot of magic from the company's welding, gas handling, and fluid management businesses, I think they have overlooked some of the structural challenges in the welding business and the end-market risks in the gas and fluid businesses.

The shares are down about 40% since my last article on the company, as multiple days of reckoning have hit its valuation hard. The evolution of the company's businesses over the last ten months has led me to slash my expectations and valuations, though I can now at least say that the valuation looks sane. I do have competitive concerns about the welding business, and I don't share the assumption that management has a magic touch that will turn every M&A transaction into a winner. That said, if you're shopping for ideas that have been pummeled into the ground, this is a name to consider.

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Colfax's Benefit Of The Doubt Has Deservedly Gone Away