Those looking into some catalyst might want to ponder over these
names for the week. I have not done extensive research on them, but this is a
way for me to share names on my list that others can work with since I have too
many ideas to work on. These are def. is
worth a serious look.
ADT Corp (ADT): Read it in Barron's. Makes for a good read.
ADT was spun off from Tyco International
in Sep-2012. The firm is trying to move beyond normal security business by
using its access to 6.43M homes. The growth might come from ADT’s efforts to
have its current customers use its equipment to monitor their children, lock
doors, control thermometers, turn on lights, and start dinner prep. Moreover,
these functions can us operation remotely via new ADT technology – something
that will ease the adaptation. The technology is currenylu sold to only 4% of
its customer base, leaving large leg room for growth. Management's revenue
growth targets for 2013 are 5%-to-7%. Subscription-based, recurring revenue is
92% of total sales. Firm has a 25% share
of the home-alarm business and 14% of the small-business segment. Firm plans to
buy back $2B of shares over next 3 years, with $600M in 2013.
Computer Task
Group (CTGX): It’s an information technology (IT) solutions and
staffing company with operations in North America and Europe.
Tech and Healthcare constiture approx 64% of total revenues. Given the
impending M&A cycle, it should be noted that IBM is CTG’s largest customer
with 30% of revenue, making this mid-cap name a potential takeover target.;
P/E: 21x, no debt, ROE 14%, Margins 5% with EPS growth 20%.
MasTec, Inc (MTZ):
It is an infrastructure construction company operating mainly throughout North America across a range of industries. Its customers
are primarily in the utility, communications and government industries. The
Company’s core services are the engineering, building, installing, maintaining
and upgrading of infrastructure for communications, utility and government
customers. I have spoken about the
upgrade cycle long due in the US
and this might be a name to look into for potentially playing that theme. I
work about Xylem
a while ago, as a play on water infrastructure. It can also be potentially
taken out, if the upgrade cycle starts. MTZ does not trade cheap, with forward P/E: 16x with ROE of 12%. My concern is the debt on the
firm, that should be looked into.
Tessera Technologies (TSRA): The battle is heating up between
Starboard and the company. The most recent board feud in addition to the
pressure from the activist may bring this company back into play, thereby making
it an interesting trade. I wrote about Tessera
(TSRA) a while ago and might be worth revisiting.
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