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Superior Industries: Progress But Challenges Remain


  • Today, we take a deeper look at aluminum wheel maker Superior Industries International, Inc., which is facing challenges on multiple fronts.
  • With little growth prospects as inflation eats into perceived pent-up demand – but reasonable valuations – the recent beneficial owner buying from another PE firm merited a deeper dive.
  • A full investment analysis follows in the paragraphs below.
  • Looking for a portfolio of ideas like this one? Members of The Insiders Forum get exclusive access to our subscriber-only portfolios. Learn More »

Wheel Alloy Wheels Rim or Mag. High performance Wheel auto car part decoration.


Americans will put up with anything provided it doesn't block traffic." - Dan Rather

Today, we take a much deeper look at a small cap concern that has the target of buyout speculation and has seen recent purchases from a

Author's note: I present an update my best small and mid-cap stock ideas that insiders are buying only to subscribers of my exclusive marketplace, The Insiders Forum. Our model portfolio has more than TRIPLED the return of its benchmark, the Russell 2000, since its launch.  To join our community and gain access to our market beating returns, just click on our logo below.

This article was written by

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We are a team of analysts led by Bret Jensen, Chief Investment Strategist at Simplified Asset Management.

We run the investing group The Insiders Forum where we specialize in small and mid-cap stocks that insiders are buying. The Insiders Forum portfolio managed by Bret Jensen consists of 12-25 top stocks in different sectors of the market that are attractively valued and have had some significant and recent insider purchases. Our goal is to outperform the Russell 2000 (the benchmark) over time.

Analyst’s Disclosure: I/we have a beneficial long position in the shares of SUP either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (31)

Interesting, less than 2 hrs of trading left and volume is just 4k.
Incredible to me how SUP has traded over the last almost 2months. Flat, narrow range, absolutely pinned down. Hopefully this bs ends Aug 3rd.
@PatentMan - I hope so. CFO insider sale doesn't bode well.....let's see.
@Invest_2020 I don’t know. Would he really sell so relentlessly that close to earnings if results were gonna suck? That would invite a lot of questions and finger pointing or worse. Trenary is a guy who fundamentally believes a CFO should not be an owner. Thank heavens our CEO doesn’t think this way.
My guess is the results will be similar to last quarter but they raise full year guidance cuz Q3 and Q4 are looking stronger and stronger.
@PatentMan - Current sentiment favors small cap value...I hope they provide better guidance as you are expecting...
In the last couple days, great GM numbers, great F numbers, GM, F, AXL, CPS, DAN, etc. are all up......yet SUP remains pinned. On the face of it, makes no sense to me.
@PatentMan - Agree. 17% increase in auto sales overall for Q2 and yet SUP guidance wasn't that great for the rest of the year during their last quarter results. Hope to see some positive surprise during the next quarter earnings.
@Invest_2020 I wonder if some of it is due to the low Aluminum prices? It will hurt their headline revenue number but will not impact net income. And longer term low aluminum is a good thing for everyone and it will ensure more wins for Superior.
All that said, I doubt it has anything to do with aluminum. Look at the entire multi decade stock chart, it has never traded sideways in this tight a range for this long.
The other problem is CFO Trenary putting in place a regular sell plan to keep selling his shares. I really like him as a CFO but think he is an idiot for not wanting to own a lot of shares.
@PatentMan - CFO sold every trading day starting 06/20 until 07/06 i.e. almost 10 trading days.
Initial position of 281,394
Ending position of 197,509

No one knows a company better than CFO and wondering why he is selling? Are we missing something here?
Wonder why SUP is trading in such an uncharacteristically tight 3.50 to 3.65 range for almost two months now? It has NEVER EVER done that before.
I have now both heard and seen this rumor/speculation in several independent places. Android Industries might be in talks to purchase Superior. Again, just a rumor but it sure makes sense when one looks at the history and growth and focus of Android.
@PatentMan In pondering this a bit more, I think Superior might be the one buying Android. Add $300mil in very profitable revenue, get some key "ins" with others in the supply chain, branch out a bit from wheels......and most importantly it could result in ridding themselves of the preferreds. Huh. It would be a hell of a surprise/shock if it happens.
@PatentMan - If SUP had no debt, it would have been easy.
@Invest_2020 What would have been easy?
Mill Road is awfully quite here.
No additional purchases even at $3.50+ range
@Invest_2020 I’m gonna start buying more shares. Axl and Dan and Cps showing life. GM and F and Tsla rebounding. Yet SUP is still dead….it is still my favorite.
New car sales are up 15.6% in May.

Both supply and sales could continue upward trend for the rest of the year and beyond

@Invest_2020 At least today GM, F, AXL, DAN, CPS are all significantly green. SUP though is flat, will likely start taking a little step up next week. At some point, people are going to start understanding that the average USA consumer (buyer) is still pretty healthy.
Well done article. I like your writing style and your approach to formulating an opinion on SUP.

I own a lot of SUP shares, it is one of my largest positions. I started buying in the 1.40ish range and have generally kept buying ever since. I have sold a bit here and there as well but generally my share count continues to grow.

I believe it will again be a $20stock but not until 2025 and only if Mill Road doesn’t buy them within the next few months for a significant premium. I am a firm believer in the pent up demand having to be built in the next couple years.

Superior also has a top notch CEO and top notch CFO with deep industry relationships.

All that said, it has been a very frustrating stock for me.
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@PatentMan Thanks for the kind words. Yes, patience is required on this name at the moment.
@The Insiders Forum - Excellent article. I am long SUP.
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@Invest_2020 Glad you enjoyed the article and thanks for the kind words. Best.
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