Stocks & Investing
Stocks and Investing
Stocks and Investing
Wed, April 27, 2011 AMG, NOR, AIN, KMT, FDX, MGIC, Financial Stocks Undervalued
April 27, 2011/ M2 PRESSWIRE / BUYINS.NET / http://www.squeezetrigger.com is monitoring the Financial sector and these stocks are the most undervalued as of today. AFFILIATED MANAGERS GROUP (NYSE:AMG), NORANDA ALUMINUM HOLDING COR (NYSE:NOR), ALBANY INTL CORP-CL A (NYSE:AIN), KENNAMETAL INC (NYSE:KMT), FEDEX CORP (NYSE:FDX), MAGIC SOFTWARE ENTERPRISES (NASDAQ:MGIC) are all expected to go Up as they are Undervalued according to industry standard valuation metrics. The valuation model employs a three-factor approach to stock valuation using fundamental variables--the company's trailing 12-month Earnings-Per-Share (EPS), the analyst consensus estimate of the company's forecasted 12-month EPS, and the 30-year Treasury yield--to create a highly accurate reflection of a company's fair value.
The chart below displays the projected Fair Value and Valuation discount/premium of the most undervalued stocks in the highlighted industry group:
Symbol Company Name Last Close Fair Value Valuation Industry
AMG AFFILIATED MANAGERS GROUP $110.13 $124.95 11.90% Undervalued Financial
NOR NORANDA ALUMINUM HOLDING COR $16.70 $18.85 11.40% Undervalued Steel
AIN ALBANY INTL CORP-CL A $25.06 $28.11 10.90% Undervalued Paper
KMT KENNAMETAL INC $41.60 $45.68 8.90% Undervalued Machinery
FDX FEDEX CORP $94.49 $103.32 8.50% Undervalued Transportation
MGIC MAGIC SOFTWARE ENTERPRISES $7.37 $7.99 7.80% Undervalued Software
Here are some of the variables that are utilized when calculating the Fair Market Valuation of a stock: Long-run EPS growth rate, Duration of Business-growth-cycle, Volatility of EPS growth rate, Systematic or beta risk of the firm, Correlation between the firm's EPS and the interest rate environment, EPS growth volatility, Dividend payout ratio, Buffer earnings, Interest rate related criteria: Interest rate (30 year yield) long-run level, Duration of interest rate cycle, Interest rate volatility. The Fair Market Valuation uses 12-month historic and forecasted EPS values and the current 30-year treasury yield as primary determinants. When calculating risk/return values such as the Sharpe ratio, the historic periods used are five years.
Some expected results of the Valuation Model are: the valuation of a stock increases in a declining interest rate environment. Increasing current and/or projected EPS will produce a higher Valuation. While long-term EPS growth would produce a corresponding long-term Valuation increase, concomitant long-term interest rate increases would offset EPS growth and depress the Valuation. The shorter a company's own business cycle, the higher its stock Valuation will be.
AFFILIATED MANAGERS GROUP (NYSE:AMG) - Affiliated Managers Group, Inc., through its affiliates, operates as an asset management company providing investment management services to mutual funds, institutional clients, and high net worth individuals in the United States. It provides advisory or subadvisory services to mutual funds. These funds are distributed to retail and institutional clients directly and through intermediaries, including independent investment advisors, retirement plan sponsors, broker-dealers, major fund marketplaces, and bank trust departments. The company also offers investment products in various investment styles in the institutional distribution channel, including small, small/mid, mid, and large capitalization value and growth equity, and emerging markets. In addition, it offers quantitative, alternative, and fixed income products, and manages assets for foundations and endowments, defined benefit, and defined contribution plans for corporations and municipalities. Affiliated Managers Group provides investment management or customized investment counseling and fiduciary services. The company was formed as a corporation under the laws of Delaware in 1993. Affiliated Managers Group is based in Prides Crossing, Massachusetts.
NORANDA ALUMINUM HOLDING COR (NYSE:NOR) - Noranda Aluminum Holding Corporation engages in the production and sale of primary aluminum products and rolled aluminum coils in the United States. The company operates through two segments, Upstream and Downstream. The Upstream segment produces aluminum products in the form of billets, which are used in building construction, architectural, and transportation applications; rods for electrical applications and steel deoxidation; sow used for aerospace; and foundry for transportation, as well as commodity grade sow. The Downstream segment offers foil products comprising finstock used for the air conditioning, ventilation, and heating industry; and container stock for food packaging, pie pans, and convenience food containers. The company is headquartered in Franklin, Tennessee.
ALBANY INTL CORP-CL A (NYSE:AIN) - Albany International Corp., through its subsidiaries, manufactures and sells paper machine clothing and industrial doors worldwide. The company operates through five segments: Paper Machine Clothing, Albany Door Systems, Engineered Fabrics, Engineered Composites, and PrimaLoft Products. The Paper Machine Clothing segment designs, manufactures, and markets paper machine clothing and process belts used in the manufacture of paper and paperboard. This segment also offers forming, pressing, and dryer fabrics. The Albany Door Systems segment designs, manufactures, sells, and services industrial doors for a range of interior, exterior, and machine protection industrial applications. The Engineered Fabrics segment offers nonwovens, which include fabrics and belts used in the manufacture of diapers, personal care, and household wipes to the paper industry and the building products market. The Engineered Composites segment provides specialty materials and composite structures for aircraft and other applications. The PrimaLoft Products segment sells insulation for outdoor clothing, gloves, footwear, sleeping bags, and home furnishings. The company was founded in 1895 and is based in Albany, New York.
KENNAMETAL INC (NYSE:KMT) - Kennametal Inc. provides tooling, engineered components, and advanced materials consumed in production processes worldwide. The company operates through two segments, Metalworking Solutions and Services Group (MSSG); and Advanced Materials Solutions Group (AMSG). The MSSG segment provides consumable metalcutting tools and tooling systems to manufacturing companies in various industries. It offers metalcutting tools for turning, boring, threading, grooving, milling, and drilling, as well as engineering services. This segments tooling systems consist of a steel toolholder and a cutting tool, such as an indexable inserts and drills made from cemented tungsten carbides, ceramics, cermets, and other hard materials. The AMSG segment engages in the production and sale of cemented tungsten carbide products for use in the mining, highway construction, and engineered applications. Its products include radial bearings used for directional drilling of oil and gas; extruder barrels for plastics manufacturers; turbine blades, burner tips, and tubing for power generation applications; food processors; and other engineered components to service various industrial markets. This segment also provides metallurgical powders to manufacturers of cemented tungsten carbide products; and intermetallic composite ceramic powders and parts for use in the metalized film industry, as well as component design services and on-site application support services. The company markets its products under the Kennametal and Widia brand names. It serves metalworking manufacturers and suppliers in the aerospace, automotive, machine tool, light and heavy machinery, coal mining, highway construction, quarrying, and oil and gas exploration and production industries. The company sells its products through direct sales force; a network of independent distributors and sales agents; and the Internet. Kennametal Inc. was founded in 1938 and is headquartered in Latrobe, Pennsylvania.
FEDEX CORP (NYSE:FDX) - FedEx Corporation provides transportation, e-commerce, and business services in the United States and internationally. It operates in four segments: FedEx Express, FedEx Ground, FedEx Freight, and FedEx Services. The FedEx Express segment offers various shipping services for the delivery of packages and freight. This segment also provides international trade services specializing in customs brokerage, and ocean and air freight forwarding services; customs clearance services, as well as global trade data, an information tool that allows customers to track and manage imports; and international trade advisory services, including assistance with the customs-trade partnership against terrorism program, as well as publishes customs duty and tax information in various customs areas. In addition, it offers supply chain solutions, including critical inventory logistics, transportation management, fulfillment, and fleet services. The FedEx Ground segment provides business and residential ground package delivery services. It primarily serves customers in the small-package market in North America. The FedEx Freight segment offers less-than-truckload freight services, as well as freight-shipping services. As of May 31, 2010, this segment operated approximately 60,000 vehicles and trailers from a network of 492 service centers. The FedEx Services segment provides sales, marketing, information technology support, and customer service support services; and access to copying and digital printing through retail and Web-based platforms, signs and graphics, professional finishing, computer rentals, and a range of ground shipping and time-definite express shipping services. The company was founded in 1971 and is headquartered in Memphis, Tennessee.
MAGIC SOFTWARE ENTERPRISES (NASDAQ:MGIC) - Magic Software Enterprises Ltd. develops, markets, and supports software development and deployment technology, and applications. It offers uniPaaS, an application platform for software development and deployment; and iBOLT, a platform for business integration and business process management. The companys application platform and technology enable enterprises to accelerate the process of building and deploying applications to customize and integrate with existing systems. It also provides information technology consulting solutions in the areas of infrastructure design and delivery, application development, technology planning, and implementation services, as well as supplemental staffing services. In addition, the company provides solution for cargo handling ranging from physical handling, cargo documentation through customs, seamless electronic data interchange communications, dangerous goods, special handling, track and trace, and security to billing. Further, it provides consulting and software development project management services to customers developing, deploying, and integrating distributed applications; maintenance contracts; and technical support, as well as conducts training on development tools. The company markets and sells its products through independent software vendors, system integrators, distributors, and value added resellers, as well as original equipment manufacturers and consulting partners. It serves finance, insurance, government, health care, logistics, manufacturing media, retail, and telecommunications industries primarily in the United States, Japan, the United Kingdom, France, Germany, the Netherlands, Hungary, India, and Israel. The company was formerly known as Mashov Software Export (1983) Ltd. and changed its name to Magic Software Enterprises Ltd. in 1991. Magic Software Enterprises Ltd. was founded in 1983 and is headquartered in Or Yehuda, Israel. Magic Software Enterprises Ltd. is a subsidiary of Formula Systems (1985) Ltd.
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