Our old friend Polypore International (PPO) continues to be a performer, although is becoming less of a secret, on the back of its lithium battery business. It is still a quiet enough stock that none of the major news agencies like Reuters or AP writes an earnings review. Year over year growth trends (ex battery business) were ho-hum, but with an 8 cent beat versus expectation, off to the races she goes.
The stock was looking very troubling the past few days, but quite a reversal today. Kind of strange such a little followed stock reacts so violently at its earning reports: Last quarter it fell 20%, this quarter it's up 15%.
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Expectations were $160M and 34 cents; Polypore came in at $169.5M and 42 cents.
Per Yahoo Finance:
- Sales were $169.5 million compared with $152.0 million in the prior-year period. Excluding the effect of foreign currency translation, sales increased 14%.
- Adjusted Net Income and Adjusted EPS were $19.3 million and $0.42 per diluted share compared with $16.2 million and $0.36 per diluted share in the prior-year period.
After a boffo year of growth, the lithium battery business is now 20% of revenue:
- Lithium battery separator sales were $33.9 million, an increase of $9.0 million, or 36%. The increase, while limited by capacity, reflects strong demand in consumer electronics and growing demand in Electric Drive Vehicles ("EDVs"). For the year, sales were $131.0 million, an increase of $44.9 million, or 52%.
The rest of the company is pretty boring (although its filtration business saw a solid 20% growth), so I won't go into it; you are buying this name mostly for this niche battery business.
Disclosure: No position