Five analysts have increased their EPS estimates for this aviation-supply business in the past 30 days.
Allegheny Technologies Incorporated (ATI)
From Positive Patterns
Do you think the aviation business will be back to “normal” by 2023? I do and here is my bet. Boeing is a bet on that; Alleghany Technologies is an even wilder bet on aviation. If you can afford some “long-shots” in the portfolio (not too many!), then ATI is one to consider.
ATI is a small cap ($3B) company that sells specialty titanium materials to the aviation business. The company has two Segments: high performance materials & advanced alloy solutions. The “customer” at ATI is the aviation business. The company lives or die on aviation business, and of course, last year was awful, and this year won’t be that good, But 2022 will be better and 2023 should be ‘back-to-normal’.
Allegheny makes titanium sponges—ingots, billets, bars, rods, wires, seamless tubes, precision components, and forgings. This is a dirty business, and while the company does find customers in other places, the focus at ATI is aviation orders.
So, for the next few years (it’s a trade) I am placing a bet at the table on RED 36 (ATI). It’s risky, but also could be big-time rewarding. Buy the stock up to $26; it’s plenty liquid as it trades 1.5 million shares a day.
Bob Howard, Positive Patterns, P.O. Box 310, Turners, MO 65765, 417-887-4486, May 4, 2021