Stephen Simpson, CFA
Long only, growth at reasonable price, value, research analyst

PolyOne Has A Great Business, But Is It A Great Stock?

With the major market indices having performed as they have this year, it's not exactly surprising that there are numerous situations where you see a good or great business with a stock up 40%, 50%, or 60%-plus over the past year. Such is this case with PolyOne (NYSE:POL), as investors have bid up the shares of this chemical company not only on expectations of improving construction and transportation markets, but also its clear commitment to transitioning to a higher-margin specialty chemical model.

Valuation admittedly always comes down to elements of guesswork and judgment, and arguments over the "right" multiples or discount rate for PolyOne can lead to pretty significant swings in estimated fair value today. Even so, it's...

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