The Company manufactures, distributes and supplies industrial products in the fields of electrical engineering and electronics, mechanical engineering, precision mechanics as well as related sectors of engineering.
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Hey Fools! I’m looking for some advice on SI.
I’ve seen a quick increase in SI since I upthumbed. (No position in RL) And I’m conflicted over whether or not to keep the pick open. My original thesis was simply that SI is a solid company, hampered by temporary Eurozone fears, at a cheap price. But now I’m not so sure how I feel about the quality/value of SI.
Historically a strong company, “the European GE”, has had zero revenue growth over past decade. However, EPS and FCF have grown significantly, albeit very inconsistently. Its cyclical nature make it very difficult (if not impossible) for a n00b like me to try and predict for the next few years. I may be outside my circle of competence with this one.
Siemens seems like a fair (not wonderful) company at a fair to cheap price, even considering its cyclical nature and the Eurozone. Equally to the point, there may just be too many solid undervalued ideas to waste time with SI. I realize I may well be losing faith in Siemens near the bottom of a long term outperformance run, but perhaps sticking w/ ideas that I have more confidence in would be more beneficial?
So, with SI at 14-15x (inconsistent) earnings and 11x last years FCF (but 20 times TTM FCF), is SI really the bargain it’s cracked up to be? If you owned share at $86, would you hold them or sell them for the quick gain? I'll probably hold, but i'd love to hear your valuable opinions.
Thanks for the feedback!
I DO own the stock. I bought it on a screen as undervalued and am sitting on a 19% gain, so I ask the same question. My problem is that I've been burned so many times with stocks that I should have sold and didn't or sold and lived to regret it. The market is easy to talk about and really, really tough to beat. But for nearly a decade it's been a traders market except for a few stocks that have gone consistently in one direction, and that's the bottom line. That's all we've got to go on in the present. You don't own a position in this stock so what the heck are you worried about? Your CAPS score? Forget about that. CAPS is good practice, a training tool. Mistakes made in real life tend to have more of an impact. Talk to me when you've got a few thousand dollars riding. I'm gonna sell if she goes to 105 and we'll see if I'm a Fool, or just a fool.
I wouldn't say i'm worried.
You are correct. CAPS is just practice. But the effort you put into practice will play a major role in future RL success or failure. I also believe practice is more benficial when you practice with teammates, rather than alone. Thanks for the feedback.