A Mining Recovery Has Boosted FLSmidth Far Enough

I always find it worthwhile to have an exit strategy in mind before ever entering a position, as it is sometimes easy to get carried away when an idea is working out. To that end, FLSmidth (OTCPK:FLIDY) has developed better than I'd expected as short-term play on a mining equipment recovery, with the shares up about 15% since my January write-up even after a roughly 10% decline from a near-term high.

Although there are potential drivers of even better performance and FLSmidth's valuation isn't bad relative to many other industrials, I'm not inclined to get greedy. So, while mid-single-digit revenue growth and margin improvements can still support a high single-digit total annualized return and I believe mining orders still have room to surprise to the good, I don't see enough upside to continue pushing this as a buy idea.

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A Mining Recovery Has Boosted FLSmidth Far Enough