Pendulum
Long/short equity, value, special situations, growth

Ply Gem: Fallen Angel IPO With Upside Potential As Housing Market Recovers

Ply Gem (NYSE:PGEM) IPO-ed in May 2013, just as the spike in interest rates and mortgage rates led to a sell-off in housing-related stocks. Ply Gem's stock price got off to a disappointing start and it is still trading below the IPO level. However, investors that believe in the housing rebound may welcome this opportunity. Despite the pause over the last few months, I am still bullish on the housing recovery. As single family housing starts recovery toward mid-cycle levels of 1.0-1.1 million annually, Ply Gem will benefit and see better financial performance. My mid-cycle outlook for Ply Gem calls for 121% upside potential, compared to -24% downside risk. In this article, I will explain my outlook and...

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