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

Komatsu's Relative Performance Gap May Not Be Unfair

To start with, I think Komatsu (OTCPK:KMTUY) is one of the better-run heavy machinery companies in the world, and I think the company's strategy to differentiate itself with technological innovation (particularly in automation) is a very good move. That said, the stock has notably lagged Caterpillar (NYSE:CAT), Joy Global (NYSE:JOY), Terex (NYSE:TEX), and Atlas Copco (OTCPK:ATLKY) over the past year, and I don't necessarily think that Komatsu is a great catch-up trade today.

Mix Matters

One of the things that concern me about Komatsu relative to Caterpillar et al is the business mix. Specifically, Caterpillar gets more than a third of its revenue from North America (Joy Global gets more...

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