Milacron Smacked Down On Tariff And Capex Cycle Worries

Life in plastic has not been so fantastic for Milacron (MCRN) lately, as this leading U.S. manufacturer of plastic processing machinery (injection, blow, and extrusion molders, as well as hot runners) has had to deal with a much more uncertain overseas market and a potential near-term peak in the manufacturing capex investment cycle.

Although I thought Milacron’s price was getting a little rich back in June, I didn’t expect the almost 40% drop in the share price over the past six months. Given considerable trade uncertainty and weakness (or at least signs of slowing demand) in key end-markets like auto, electronics, and general industrial, it may be a little while before Milacron sees orders and margins recover. While the long-term story is still interesting and the valuation is much less demanding, this will be a tougher place to make money unless and until the outlook and sentiment for industrials improves.

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Milacron Smacked Down On Tariff And Capex Cycle Worries