The Long Case for GT Advanced Technologies

| About: GT Advanced (GTATQ)

GT Advanced Technologies (GTAT) is a leading global provider of polysilicon production technology, and sapphire and silicon crystalline growth systems and materials for the solar, LED and other industrial markets. Their manufacturing equipment and services support the growth of the Solar and LED industries and accelerate the adoption of renewable energy for a more sustainable world.

GTAT is rated a Buy by Sabrient Systems. According to Sabrient’s rankings, it beats other similar sized companies (TSL, LDK) in the same industry group in the following areas (all scores are out of 100, the higher the better):

Growth Score 88.7. Industry 69.2. This growth score reflects a company’s historical and projected earnings growth, revenue and sales growth, projected cash flow, analyst activity, and changes in earnings estimates over time.

Value Score 73.0. Industry 64.4. This score measures the relationship between GTAT’s stock price 11.30 as of the close on Wednesday, compared to its intrinsic value. GTAT reached its 52-week high last month on July 7th at 17.11, putting it at a great bargain price.

Momentum Score 77.4. Industry 40.6. Measuring earnings and price momentum, GT handily beats its competitors due to its three diverse business segments: Photovoltaics, Polysilicon, and Sapphire.

Earnings Score 83.0. Industry 56.8. Here the overall earnings performance and projected outlook is assessed. Time periods include an average look-back of three years with an emphasis on the past four quarters and a forward look of one to five years.

Balance Sheet Score 81.0. Industry 48.3. GTAT’s liquidity, debt issues, receivables, and inventory is under control. Given the high score, GT is a lower risk stock than any of its competitors.

Fundamental Score 98.2. Industry 64.8. Broadly taking financial health into account, including balance sheet, cash flow, revenue, and earnings quality, GTAT appears able to weather whatever flares the market produces.

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op data gtat

We can see from GTAT’s operations data that it has cut costs by 15% from last year and has increased its income from operations by 14% (Courtesy of GTAT’s 10-Q off Yahoo! Finance).

Futhermore its total revenue has increased 71%, due mostly to the explosion of the solar business. The solar industry continues to gain traction as efficiency of solar conversion increases and production costs are cut.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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