Itron, Inc. (NASDAQ:ITRI)

From Investment Reporter

Here's my recent take on the investment thesis for Itron:

http://beta.fool.com/brewcrewfool/2012/07/16/investing-in-the-inevitable-itron/7142/

Brian
Long ITRI

metered efficiencis

A play on the smartgrid.

pe of 12.9. one of my favorites liked it.

Might take a while, but near 52-wk low; long-term outperform.

Nice dip! Now may be the time to jump in. I will watch ITRI. Maybe a real position in the future.

try it again after sell-off

putting in real $ tommorow

Water, infrastructure. As water becomes scarcer its a no-brainer

As the US and other countries modernize their power grids, smart meters will be an important part of the upgrade. Itron can expect to benefit from the upsurge in spending for years to come.

It may take time, but I own this one because of the smart meter revolution. We need boring things to help preserve energy and clean water too.

Infrastructure in play

I had picked this stock awhile back to out perform but so far it has failed to outperform the market. I took another look at the numbers and realized there was not much in their financial stats to make me want to keep them.

They have seen a jump in quarterly earnings over 20% which always makes for a good starting point when searching for new stocks but the good news stops there. Looking at their ROA and ROE both of these numbers are below 5%. Generally I like to see companies with ROA and ROE at 10% or more. (Unless they are financial companies.) More bad news their profit margin is tiny. Some companies in other industries like FedEx and UPS can thrive off of 3% or 6% profit margins. Itron however has a serious cash flow problem on its hands that is constraining it. The Current Ratio is a very healthy 1.5. That however is misleading since Current Assets includes net Receivables. When you look at their cash on hand and their net receivables you realize that a lot of people owe them money and the company is probably living paycheck to paycheck as it were. Management has seen this problem and taken out an additional $125M credit line to help with liquidity. Itron may have a good business but I don't see it out performing any time soon. At least not until they figure out had to get paid quicker or manage their cash flow better.

I do with some reluctance, because I think spending on smart grid (read "more meters") will increase in the near term ... but I think there will eventually be fallout based on overhyped expectations, resulting in canceled orders. We'll see.

Future Demand plus White House backing should help this company outperform

Itron is a strong company, with strong products.
I believe they will always be strong. I wish they paid a Dividend.
They are in the "KO, PEP, APPL" catagory. It's a keeper.

With the massive flow of stimulus dollars into smart meters it will be hard for this one to miss...

Smart grid development, should be a good year.