– Manufacturer/supplier of rolled aluminum products for industrial uses.
– Undervalued relative to peers.
– Favorable growth tailwinds with healthy demand for aluminum rolled products at all ARNC’s end markets.
– Due to execute a few 25-35% IRR projects.
– The company expects to grow run-rate EBITDA by 40%+ over the next 3 years.
– Trades at 5x ’23 EBITDA (consensus) with little leverage.
– Peer group is at ~6.5x ’23 EBITDA with x higher leverage.
– Well, protected downside at a currently low valuation.
Exp. gain: +45% to $42/share (DCF model).
Full ARNC write-up (free guest account required):