Seeking Alpha
Editor's notes: Margin growth in its architectural business and cyclical recovery present a good opportunity for APOG. The company's valuation offers 50-75% upside over the next 2-3 years.

Apogee Enterprises (APOG) is a world leader in high-performance glass coatings for buildings with a smaller large-scale optical glass business as well. The company, with a new CEO who joined in 2011, has weathered the storm in its architectural business, which is tied to construction. While the overall business may be fairly valued on the surface at about 20X forward EPS, substantial margin improvement potential in the still-depressed larger architectural business suggests that the stock could appreciate by 50-75% over the next 2-3 years.

Background

Based in Minneapolis, APOG provides value-added glass products and services in four areas, with three of them catering to commercial construction and the fourth serving the custom picture-framing market. Until this year, the...

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