There have been some “fits and starts” to the post-pandemic recovery, including mixed trends on capital spending and manufacturing activity in some sectors, but with fiscal second quarter results in hand, Hurco’s (HURC) recovery seems to be solidly underway, and looking around the industry, I expect “recovery growth” over at least the next few quarters.
Hurco has lagged the broader industrial sector since my last update, but done a little better than my own “peer group” of metalworking-driven companies. The stronger evidence of recovery should be good for the stock from here, and I do believe the shares are undervalued below $40 in the near term (and priced for longer-term annualized returns in the double-digits), but this is an unfollowed, illiquid company, so investors need to understand the risk that this remains overlooked for an extended period of time.
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