$76.24 -0.76 (-0.99%)
2/14/2012 10:52 AM

Lufkin Industries, Inc. (NASDAQ:LUFK)

CAPS Rating: 4 out of 5

The Company and its subsidiaries manufacture and sell oil field pumping units, power transmission products and highway trailers throughout the world.

Recs

7
Player Avatar JDSancho (98.97) Submitted: 6/18/2008 11:32:29 PM : Outperform Start Price: $26.09 LUFK Score: +25.67

A truely outstanding pick made by EldrehadsPicks in October 2007. If you would like to read a thorough analysis of this company, visit his blog...

http://caps.fool.com/Blogs/ViewBlog.aspx?t=01002263092484976839&month=10&year=2007

For a quick summary of his points:

* LUFK operates in 3 main segments: oilfield equipment, power transmission, and trailers. Oilfield equipment consists of 2/3 sales, and is the reason why I was attracted in the first place.
* top line has increased 30% annually over 4 yrs
* sign of good managment: SG&A decreasing as % of sales
----> operating/net margins increasing YoY as well
* management had a good feeling about company's prospects at the end of 2007 based on backlog & international strength (man, were they right on the money)
* strong balance sheet w/ $0 debt and $7 cash per share

Unfortunately, we're already over 3/4 of the way to Elrehad's fair value estimate of $104, based on 11% growth.
I saw this as a great opportunity and pulled the trigger on CAPS, but missed out on a nice return with real money. I am grateful to Big E for introducing us to a great company that will most likely continue its successful run for investors.

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