Hawkins, Inc. (NASDAQ:HWKN)

Re-add after dip.

Small cap chemical company that is weathering a beat-down. This may not be your entry point, but it should go in your watchlist.

Caps- Most Down

Personal scoring-68 71 66

I think we have a winner here. Hawkins is a Minnesota-based company selling specialty based chemicals. Earnings have been growing 32 percent over the long term. Analyst's estimates seem spotty here because it is not well followed. No debt and lots of cash makes this one a keeper.

Appeared on the Highly Rated stock list.

Steady growth and return on equity. A winner for the long haul.

A winner. Just ask the shorts.

I like the consistent revenue and earnings growth and the low PE which is currently 8.77 and the 3.5 dollars per share they have in cash. A boring company that blends and distributes chemicals for industrial and water treatment.

No Debt, stable growth

HWKN (Hawkins Inc.)
This Minneapolis based chemicals company has been in business since 1938, and has two segments of Industrial (65% of sales) and Water Treatment (35% of sales). As you could predict, the Industrial segment was down, and off by 23% last quarter, hit by the recession, but the Water Treatment segment (apparently if you live in the Midwest you've drunk water treated by their chemicals) was stable as it declined by less than 5% in sales.

So basically you have a small, but stable, long term slow growth company, and it is trading at an attractive valuation of just 9 times trailing earnings and 10 times forward estimates. They also have a cash hoard of $37 million built up, along with no debt, making the company a further bargain yet. The stock pays out a 2.5% dividend, which is not in jeopardy at all considering it is a small fraction of their earnings. A ten year chart is interesting to look at to see how slow and steady the stock has been up until this year. Since it has had a large rally this year, I'm just going to keep it on my radar screen and purchase only if the stock pulls back in a bit, even though fundamentally it does still seem priced attractively.

RK

good company but overvalued so far

Their procurement strategy enabled hawkins to sell their products at high levels of profitability. Using LIFO inventory adjustements, they posted record profits from a decrease in inventory costs. I've noticed that this tends to be a normal part of doing business for Hawkins since, essentially, they are selling commodity based products. The fun's over for now. The CEO did mention raw material prices are softening in the near term, which will drive down profit margins. Their water treatment chemicals may also have softer demand because were comming off peak usage. They are invovled in other industries which are not cyclical by nature, which will offset decreases in other areas. Long term, I'm very bullish on this company. The intrinsic value of the company has steadily increased. They have a history of generating a decent return on shareholder's equity. They've made smart aquisitions, and are expanding their facilities. They're also focusing on higher margin specialty chemicals. In my view, the company's intrinsic value may have grown in line, or just shy of its market value. Long term, the company has favorable economics and will continue to grow its intrinsic value above its peers.

Hawkins has recently shown up in the holdings of value gurus, and it's easy to see why. The company is small and boring. It has a good balance sheet, management is aligned with shareholders' interests, and there is reliable demand for the company's products. Under ten times trailing earnings, the price gives value investors a good margin of safety, while the healthy dividend only sweetens the deal.

Fantastic fundamentals, growing, also seems under the radar.

no debt, dividend, steady growth, ~20% insider ownership, small cap

small-cap with strong 5 year ROE& profit margin improvement

Found this one with a NASDAQ Guru search. Consensus agreement among 3 gurus only picks a handful of stocks, and this was one of them.

basics, good income statement and balance sheet,goodp/e

5 Star, Small Cap- pays dividend