|
A natural beneficiary of the upturn in capital equipment, especially in oil-drilling and production, particularly given its prime position in Brazil to supply the potentially massive Tupa field. However, execution has been weak, with rising costs not always being passed on, especially in steel and aluminium. The most recent results showed that earnings run the risk of being squeezed in 2008, hence the sale.
Vallourec. France's dominant producer of hot-rolled, seamless steel tube products for a wide range of industries, including auto, nuclear and desalination plants, oil and gas and petrochemicals. Production, research and distribution are all globally based. With a return on equity of 40%+ vs. price to book and sales ratios of 4.3 and 1.7 times respectively, coupled with a 3.5% yield and a single-digit multiple, the company is substantially mis-priced.
| Sedol |
Type |
Price |
Date |
| B197DR6 |
Sell |
EUR 143.243 |
05/02/2008 |
| B197DR6 |
Buy |
EUR 191.944 |
06/12/2007 | |
