$9.61
-0.10 (-1.03%)
CPI International, Inc. (CPII)
CAPS Rating:
A provider of microwave and radio frequency, power and control products for critical defense, communications, medical, scientific and other applications.
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Fool UK
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CPI International looks like a solid company with some very good prospects for growth. They sell all kinds of various products that can be utilized in all sorts of growing industries. Some of the components in their portfolio are distributed to businesses for a wide aray of applications such as medical, satellite communications, electronics, industrial, and other scientific markets.
CPi has a market cap of a little over $300 million and a multiple in the mid teens, as I write this pitch. This company has a lot potential room to grow.
With inside ownership of over 50%, this looks like a company for the retirement portfolio.
Go Long,
Fool On!!!
I know this company very well, and it is a well run company, but if you're buying this company for growth...keep looking. 80% of their revenue is tied to low growth end markets like like Radar and eletronic warfare which grow 2-4%. Their communications/satellite end market has been very cyclical, with no real sustainable trends. The only real growth end market is medical of which is driven by MRI/medical imaging technologies which comprises about 20% of sales. The multiple is relatively reasonable, but don't expect it to be a fast grower. Revenue should grow in 3-5% range with eps growth in the 10-12% range over time. It is a relaitvely defensive business, but probably not a company you should hold for retirement. Additionally the 50% ownership is somewhat misleading, as most those shares held are from the private equity sponser who will most likely be a seller in the next 12 months.