Specialty chemical company RPM International (RPM)
is a curious company for GARP investors. The company has a strong
record of sales and free cash flow, but the company's book value growth
and returns on invested capital have not been so remarkable. RPM also
has a strong collection of brands and a good history of adding value to
its acquisitions, but valuations have been marching higher for a few
years while most value-creation metrics haven't kept pace.
I might
not rush to sell RPM International if I owned shares today, but buying
it at these prices is another story. I do believe that the company can
leverage a recovering residential remodeling/repair market as well as
growth in infrastructure spending and international markets, but it's
very hard to find a metric whereby these shares look like a bargain for
value-oriented investors.
Read the full article at Seeking Alpha:
RPM Redlining On Value
No comments:
Post a Comment