Thursday, October 10, 2013

Sun Hydraulics (SNHY) 2013 Review


Sun Hydraulics designs, manufactures and markets valves and manifolds for hydraulic systems including  electrical and nonelectrical actuated valves,  machined manifolds and custom valve and manifold assemblies for use in construction agriculture, mining, industrial and fire and rescue equipment.  The company has grown dividends and profits at a 12-13% pace over the past five years earning a 15-20% return on equity.  SHNY’s business suffered dramatically in the 2009 recession; however, it has made a strong comeback which should continue as a result of:

(1)        growth in global industrial capital expenditures,

(2)        price increases,

(3)               international expansion,

(4)      acquisitions.

Negatives:

(1)        its international business exposes it to the uncertainties of foreign laws and        regulations as well as currency fluctuations,

(2)      intense competition.

            SHNY is rated B+ by Value Line, it has no debt and its stock yields 1.1%.

   Statistical Summary

                  Stock      Dividend         Payout      # Increases   
                  Yield      Growth Rate     Ratio       Since 2003

SNHY        1.1%           10%              27%             6
Ind Ave      1.5              11                 25               NA  

                Debt/                       EPS Down       Net        Value Line
              Equity         ROE      Since 2003      Margin       Rating

SNHY       0%            24%            2                 18%            B+
Ind Ave     30             17             NA                 8               NA

     Chart

            Note: SNHY stock has made great progress off its March 2009 low, quickly surpassing the downtrend off its August 2008 high (red line) and its November 2008 trading high (green line).  Long term the stock is in an uptrend (straight blue lines); intermediate term it is in an uptrend (purple lines).  The wiggly blue line is on balance volume.  The Aggressive Growth Portfolio owns a 50% in SNHY.  The upper boundary of its Buy Value Range is $31; the lower boundary of its Sell Half Range is $52



10/13

No comments:

Post a Comment