Industrial Valve Prices Continues To Bode Well For Producer Stocks

Includes: CW, EMR, FLS, MOG.A, TYC
by: William Trent, CFA

This morning’s PPI report (.pdf) showed that the frantic price increases for industrial valves have cooled a bit. Still, price gains are well above the long-term average and the general trend still seems to be rising.

click to enlarge

According to Alexander’s Gas & Oil Connections:

The market leader positions in the industry changed considerably with the acquisition of Invensys Flow Control by Flowserve (NYSE:FLS). The combination is now the second largest supplier with a 4% market share. This compares to a 6 % share for the leader Tyco (NYSE:TYC). Emerson (NYSE:EMR) with 3 % is in the third position. The industry is very splintered with more than 1,000 companies carving out niches.

Moog (NYSE:MOG.A) and Curtiss-Wright (NYSE:CW) are others that come to mind as possible beneficiaries.