Wall Street hates uncertainty and there’s plenty of that when it comes to distributors in general and Applied Industrial Technologies (AIT)
in particular. With two-thirds of Applied Industrial Technologies’
verticals still growing and macroeconomic metrics like manufacturing
capacity utilization, PMI, and industrial production still favorable but
weakening, there’s plenty of uncertainty as to just how well the U.S.
(and global) economy will perform in 2019.
AIT has
done a lot to build up its business, and particularly its higher-margin
fluid power business, and this a company with a strong ROIC record. I’m
concerned about slowing momentum in 2019 and the possibility of further
revisions to near-term guidance, but I do see a path for
mid-single-digit revenue growth and double-digit FCF growth that can
support a higher share price from here.
Click here for more:
Applied Industrial Technologies Starting To See The Slowdown
No comments:
Post a Comment