Money Trees
Deep value, growth, momentum

CyberOptics: Exit From Cyclical Low Presents A Window Of Opportunity

Thesis

CYBE has compelling upside for the following reasons:

  1. Cheap valuation, attractive takeout candidate
  2. Emerging from a trough with improving fundamentals
  3. Potential to exceed previous earnings and free cash flow peaks
  4. New product launches with potential to steal market share
  5. Strong cash flows and exceedingly healthy balance sheet
  6. Trading at cyclical lows despite signs of accelerating improvement in the underlying business

I believe the stock is worth at least $10 in an up-cycle, perhaps as high as $12 - $14 and is an attractive takeout target considering the company's cash flow, strong balance sheet, as well as the fact that CYBE's industry is coming out of a low point in the cycle and capital spending appears to be returning with...

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