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

American Vanguard Starting A Long Road Back

Back in my Wall Street days, American Vanguard (NYSE:AVD) would have been called "a stock split the hard way", as the shares have dropped almost 50% over the last year on persistently weak sell-through of soil insecticides and herbicides for corn. Weather has had an impact, as have acreage switches to other crops and less insect pressure, but the fundamental issue is that management significantly overestimated the on-the-ground demand for its products and is now stuck working through inflated inventories and inefficient overhead utilization. I don't think the positives that moved the stock in 2013 have all vanished, but management has a lot to prove before these shares can move back into the $20's.

Inventories Crush Q2 Results...

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