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

Fracking Will Recover, But Can Twin Disc Achieve Better Margins?

I really want to like Twin Disc (NASDAQ:TWIN). Not only does this small and almost unfollowed company make the sort of heavy industrial gear that I like, it's a good play on multiple markets that I believe are due to recover. Twin Disc also offers a level of information available to investors that companies 10 times or 100 times larger often fail to offer.

The short-term question is timing - I am confident that fracking, off-highway vehicles, and marine markets will recover, but I'm not so confident about when. The longer-term question is one of margins and operating cash flow generation - if Twin Disc can't generate double-digit operating cash flow margins as a percentage of sales, it...

Join Seeking Alpha PRO to read this archived article and 11,574 other archived articles
FREESA PRO MEMBERS
IDEA GENERATORXExclusive access to 10 PRO ideas every day
INVESTING IDEAS LIBRARYXExclusive access to PRO library of more than 15,000 ideas
SECTOR EXPERT NETWORKXExclusive access to all sector experts for direct consultation
PERFORMANCE TRACKINGXTrack performance of all PRO stock ideas
PROFESSIONAL TOOLSXProfessional Idea Filters to zero-in based on industry, market cap and more
"In just the first month of using PRO, I used it to generate two ideas which were actionable for me. As a result of these two positions, I have earned more than 20 times the annual subscription costs for PRO."Michael Yagemann, Greenbridge Capital
"I am pleasantly surprised with the scope of small and mid-cap coverage PRO offers. You can't find that any where else."Patrick Rice, Mainstay Capital Management
You may cancel at any time for any reason, and receive a prompt refund for membership on months paid and not used (max. 6 months). Details