Debating whether to post this here or the Woodshead Tavern….
Did anyone have the forsight to invest in this company in the mid 90’s? (symbol is SSD). This company’s earnings have been growing by 20 – 30% per year, and $10,000 invested in this company 3/95 would be worth about $140,000 today! And with a trailing P/E of about 20, this company is seemingly not overpirced…but the real question…can Simpson continue this level of growth?
Here’s my twisted reasoning….
The American building industry has been on a tear, and new construction requires engineering that invariably leads to lots of sheer and seismic requirements that Simpson seems only too happy to meet. Now, certainly, the building rate here will slow, but with Simpson now expanded into Austrailia, South America, New Zealand…and presumably into the Malasian Tsunami area, isn’t it logical that demand for what they make will continue to grow?
And what about competetion…anybody else make what Simpson makes?
And to think that I jokingly asked my engineer, after reviewing his drawings/requirements, if he owned stock in Simpson! Now, I’m not sure I should have been joking.
BruceM
Replies
http://clearstation.etrade.com/cgi-bin/details?Symbol=ssd
I wouldn't say today is the right time to get in though.Even though analyst ratings run hold to outperform Forward earnings growth is slowing from about 20% to around 15% and the insiders are selling, but not wholesale jumping ship. Potential negatives might be related to failure re new PT chemicals. They should not be liable but may have some defense costs to prove innocence. They also carry a disproportionate amt of debt for the current financial environment, meaning that increases in interest will cut into profits.
Competition?
http://www.smartmoney.com/eqsnaps/index.cfm?story=competition&symbol=SSD
They win hands down over their gemneric competition in similar industries with fifteen percent growth vs their measely 3-4% lately but relative to their own past growth, not so great. Not a bad company to have owned or to own, but I would wait to buy.
I am not a professional investor, so take it for what it's worth to you in your own analysis.
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I had a problem with some Simpson strongdrive screws. The Hot dip galvy hex heads would not fit in the hex driver. Simpson sent out a rep today for my one pound box of screws. Thats good service, and a company that stands behind its product.Not sure if thats enough resone enogh to invest, but leans me in the right direction.stevehttp://www.lukeworks.com
It is a good sign. There are three sides to every company.
One is how it treats its customers
Two is how it treats its employees
Three is how it treats its stockholders. usually, when the directors focus on the first two, the third will have ample reward. Note that I was not panning the company, only the stock price at this particular time. Though the price is "on sale" which is good for any investor with faith in the long term prospects of the company, the trendline on that price is still facing down. One rule for investors is not to fight the trend. An investor confident that this is a short dip in price wgho wants to make this company a long term hold is justified in buying now.
Welcome to the Taunton University of Knowledge FHB Campus at Breaktime. where ... Excellence is its own reward!