Wednesday, June 14, 2017

Sika AG's Specialty Chemical Businesses Continue To Outperform

Swiss specialty chemical company Sika (OTC:SXYAY) (OTC:SKFOF) is an interesting company in many respects. A leader in construction chemicals and a meaningful player in adhesives and sealants, with a strong position in autos, Sika has not only established a strong portfolio built on highly-focused R&D, but also established a strong business with a strong run of improving margins and returns since 2011.

"Interesting" is not an unreservedly positive word, though, and so too in this case. Sika's ADR volume is minuscule, and the company's low share count means the per-share price is quite high and likely out of reach for many individual investors. What's more, there's a dispute between the independent members of the board and an insider group that is wending its way through the Swiss court system.

Sika's shares have been relatively strong over the past few years, but the shares still appear to have a little bit of upside from here. With opportunities to meaningfully grow its business in North America and benefit from emerging market infrastructure growth, there are still opportunities for outperformance from here, but a lot is riding on shareholder-friendly resolution of the ongoing legal issues.

Read more here:
Sika AG's Specialty Chemical Businesses Continue To Outperform

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