– Relatively mediocre business, however, it is cheap on all metrics.
– Trades at 7x EBIT, slightly above net current assets.
– Well-protected downside and meaningful potential upside.
– The company manufactures/sells single-use protective apparel products and building supply products.
– Net cash balance sheet and rational capital allocation strategy.
– Uses all FCF to buy back stock, S/O declined from 27m in 2006 to 13m today.
– Shares might skyrocket on the next viral outbreak, as has already happened due to H1N1 in 2009 and COVID in 2020.
– Attractive M&A target for both financial and strategic buyers.
– EV/sales is 0.52x, EV/EBIT is 6.8x, and EV/NOPAT is 8.6x. NCAV per share is $3.77 (1.14x) and TBVPS is $4.85 (0.89x).
– TBVPS is set to compound at 8% annually in the absence of any viral outbreaks.
Exp. gain: Not specified.
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