Materials
The secular trend of the reindustrialisation of the US / North American market is one that TRG believes has a long tail for growth (10+ years) and will see a greater differentiation of winners. As a vertically integrated heavy materials producer, KNF is well placed to benefit. It was an “orphaned asset” under the MDU umbrella, and now as an independent entity, it has a greater ability to focus on value creation. To that end, KNF has already hit its 15% EBITDA margin target two years early. The next stop is 20%+, which TRG believes will come from a mix of pricing, cost control, and mix shift to materials focused from both organic and acquired efforts. 55% upside.
Edition: 187
- 31 May, 2024
Special Situations: 10 stocks poised for long-term growth
The companies highlighted in The Edge's latest report are all undervalued vs. their industry peers, while exhibiting strong fundamentals, including impressive profit margins and strategic leverage. European and US names include: 1) Melrose - divesture of its Aerospace division looks set to unlock considerable value for investors. 2) Solvay - the share price has rerated sharply higher following the successful spin-off of Syensqo earlier this month. 3) BorgWarner - ICE to EV opportunity. 4) MDU Resources - the next big utility play; activist involvement. Click on the button below for further information on how to capitalise on these and more spin-off opportunities.
Edition: 176
- 22 December, 2023