Although this equipment company missed analysts’ estimates last quarter, forecasts are trending up for the rest of the year.
Chart Industries, Inc. (GTLS)
from Validea Hot List Newsletter
Strategy: Price/Sales Investor
Based on: Kenneth Fisher
Guru Score: 90%
Chart Industries, Inc. (GTLS) is an independent global manufacturer of engineered equipment used in the production, storage and end-use of hydrocarbon and industrial gases. The company supplies engineered equipment used throughout the global liquid gas supply chain. It operates in three segments: energy and chemicals (E&C), distribution and storage or (D&S), and biomedical. The E&C and D&S segments manufacture products used primarily in energy-related and general industrial applications, such as the separation, liquefaction, distribution and storage of hydrocarbon and industrial gases. Through its BioMedical segment, it supplies cryogenic and other equipment used in the storage and distribution of biological materials and oxygen, used primarily in the medical, biological research and animal breeding industries.
PRICE/SALES RATIO: [PASS]. GTLS’s P/S ratio of 0.95 based on trailing 12 month sales, falls within the “good values” range for non-cyclical companies and is considered attractive.
TOTAL DEBT/EQUITY RATIO: [PASS]. GTLS’s Debt/Equity of 24.01% is acceptable, thus passing the test.
LONG-TERM EPS GROWTH RATE: [PASS]. GTLS’s inflation adjusted EPS growth rate of 19.99% passes the test.
FREE CASH PER SHARE: [PASS]. Companies should have enough free cash available to sustain three years of losses. This is based on the premise that companies without cash will soon be out of business. GTLS’s free cash per share of 1.84 passes this criterion.
THREE YEAR AVERAGE NET PROFIT MARGIN: [PASS]. GTLS, whose three year net profit margin averages 6.98%, passes this evaluation.
John Reese, Validea Hot List Newsletter, www.validea.com, 877-439-0506, May 22, 2015