I became bullish on Regal Beloit's (NYSE:RBC) when its share price plunged on weak Q1 2013 earning. At the time, I expected the stock price to rebound and reach $90 per share by mid-2014. My bullish thesis was based on: [i] low sentiment after the weak Q1 results, [ii] potential for a turnaround in earnings, [iii] a strong balance sheet that could be used for significant acquisitions and [iv] a low valuation relative to peers. The stock price has started to tick up and the bull thesis still has room to run in 2014. In this article I will analyze these trends and the opportunity for the bull thesis in the coming year.
For background about the company,...
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