Industrials
Northcoast’s channel checks continue to reveal a slowing demand growth environment for nickel-based alloys. The average shipment comp reported by nickel-alloy survey participants was up 2-3% Y/Y, compared to +4-5% growth in CY2Q. Drivers behind an increasingly cautious 2H24 outlook include slowing jet engine orders, but the most surprising takeaway from recent checks was a sharp drop in medical-related demand. Contacts reported flat-to-down 1% order growth for CY3Q, which is down from the +7-9% growth range to start the year.
Edition: 193
- 23 August, 2024
Industrials
The stock was highlighted at MYST’s latest Industrial Ideas Forum, with the Presenter claiming that OEM’s “can NOT make planes” without CRS’ specialty metal alloys, putting it in the sweet spot of the aerospace supply chain. While he sees upside to Street estimates and ample room for multiple expansion, he believes CRS also offers substantial “discovery value”, noting that it has relatively limited long only sponsorship and is covered by just 3 Sell-side analysts with stale earnings estimates. Management’s plans to double FY19 operating income by FY27 look conservative. The stock trades at a substantial discount to peers despite having similar scarcity value. TP ~$120 (100% upside).
Edition: 167
- 18 August, 2023