The worst might already be over for Haynes International, as it returned to profitability in the third and fourth quarters of fiscal 2014 following two consecutive quarters of losses.
Potential catalysts include an earnings recovery in 2015 and an improvement in margins resulting from strategic capital investment projects.
Haynes International boasts unique competitive advantages with respect to strong customer relationships and alloy development capabilities, making it well-positioned to capitalize on strong growth for its end-markets.
Target price implies 23% upside based on 10.5 times EV/EBITDA multiple.
Haynes International (HAYN) issues downside guidance for FQ1; revenue is expected at $114M vs. $135M analyst consensus, attributed to ongoing uncertain economic conditions. FQ1 earnings will be "lower than previously anticipated, and we expect earnings will be uncertain in the near future due to lack of visibility."