Hurco Already Hit Hard In Anticipation Of Weaker Capex Spending

What I thought back in March may have just been a “pothole” for Hurco (NASDAQ:HURC) has started looking more like a sinkhole, as orders have turned down and investors have grown considerably more worried about the health of short-cycle industrial names, particularly those exposed to capital equipment budgets.

Time will tell if we get a true cyclical downturn in the next few quarters or whether this is a shorter “correction” in response to inflationary and labor pressures (not to mention the chaos created by the pandemic). In any event, it’s clear that short-cycle industrials are by and large not in favor right now, and while I do think Hurco’s valuation is too low now, the reality is that the market can often overcorrect and investors looking to take advantage of the pullback have to at least be aware of the risks of further declines before the outlook and sentiment stabilize.

 

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Hurco Already Hit Hard In Anticipation Of Weaker Capex Spending