ICO Polymers Growing Revenues 60% in Australasia

| About: ICO Inc. (ICOC)

Mr. McGuire: I want to say one word to you. Just one word.
Benjamin: Yes, sir.
Mr. McGuire: Are you listening?
Benjamin: Yes, I am.
Mr. McGuire: Plastics.
Benjamin: Just how do you mean that, sir?

By Plastics, I mean ICO Polymers (ICOC), a global blender, grinder, and compounder of polymers used in rotational moldings. What? In a nutshell, they formulate the plastic that is used to make hollow plastic parts. Everything from chemical storage tanks to traffic cones are rotomolded. Rotomolding is an economical alternative to injection molding and is finding increased acceptance especially in low wage markets.

Why this is interesting is of course the global growth story - fully 68% of the company's sales are overseas. More interesting is the 60% revenue growth rate seen in their Australasia division. Results are being led by the relentless growth in the region as well as specific demand from China. (Think fish and toys - anybody know why fish?)

The weak dollar is a boon to this company through translation gains and pricing parity. I am looking for 20% + EPS growth for the next few years. Let's look at the numbers:

PE trailing: 16
PE Foward: 14.5
P/Sales: 64%
ROE: 25%
Debt:: 67%

Not bad. This is a name that I am going to do a little more in-depth work on but on the surface ICOC seems to have some promise.

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