The following are the top rated Basic Materials stocks according to Validea's Low PE Investor model based on the published strategy of John Neff. This strategy looks for firms with persistent earnings growth that trade at a discount relative to their earnings growth and dividend yield.
RELIANCE STEEL & ALUMINUM CO (RS) is a large-cap value stock in the Misc. Fabricated Products industry. The rating according to our strategy based on John Neff is 81% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Reliance Steel & Aluminum Co. (Reliance) is a metals service center company that operates as a metal solutions provider metals service center. The Company provides value-added metals processing services and distributes metal products, including alloy, aluminum, brass, copper, carbon steel, stainless steel, titanium and specialty steel products. Reliance serves various industries, including manufacturing, non-residential construction, transportation (rail, truck trailer and shipbuilding), aerospace and defense, energy (oil and natural gas), electronics and semiconductor fabrication, and heavy industry (agricultural, construction and mining equipment). The Company also serves the auto industry, through its toll processing operations. The Company provides a network of approximately 315 locations in 40 states in the United States and 13 other countries, including Australia, Belgium, Canada, China, France, India, Malaysia, Mexico, Singapore, South Korea, Turkey and the United Kingdom.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
| P/E RATIO: | PASS |
| EPS GROWTH: | FAIL |
| FUTURE EPS GROWTH: | PASS |
| SALES GROWTH: | PASS |
| TOTAL RETURN/PE: | PASS |
| FREE CASH FLOW: | PASS |
| EPS PERSISTENCE: | PASS |
Detailed Analysis of RELIANCE STEEL & ALUMINUM CO
AMCOR PLC (AMCR) is a large-cap growth stock in the Containers & Packaging industry. The rating according to our strategy based on John Neff is 62% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Amcor plc is a packaging company. The Company is developing and producing packaging for food, beverage, pharmaceutical, medical, home and personal-care, and other products. It works with companies around the world to protect their products and the people who rely on them, differentiate brands, and improve supply chains through a range of flexible and rigid packaging, specialty cartons, closures, and services. Its segments include Flexibles and Rigid Plastics. The Flexibles Segment consists of operations that manufacture flexible and film packaging in the food and beverage, medical and pharmaceutical, fresh produce, snack food, personal care, and other industries. The Rigid Packaging Segment consists of operations that manufacture rigid containers for a range of beverage and food products, including carbonated soft drinks, water, juices, sports drinks, milk-based beverages, spirits and beer, sauces, dressings, spreads and personal care items, and plastic caps.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
| P/E RATIO: | FAIL |
| EPS GROWTH: | PASS |
| FUTURE EPS GROWTH: | PASS |
| SALES GROWTH: | PASS |
| TOTAL RETURN/PE: | FAIL |
| FREE CASH FLOW: | PASS |
| EPS PERSISTENCE: | PASS |
Detailed Analysis of AMCOR PLC
BERRY GLOBAL GROUP INC (BERY) is a mid-cap value stock in the Containers & Packaging industry. The rating according to our strategy based on John Neff is 60% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Berry Global Group, Inc. is engaged in providing packed and engineered products. The Company's segments include Consumer Packaging International, Consumer Packaging North America, Health, Hygiene & Specialties, and Engineered Materials. The Consumer Packaging International segment consists of containers, closures and dispensing systems, pharmaceutical devices and packaging, bottles and canisters, and technical components. The Consumer Packaging North America segment consists of containers and pails, foodservice, closures, bottles, prescription vials, and tubes. The Health, Hygiene & Specialties segment consists of nonwoven specialty materials, tapes and adhesives, and films used in hygiene, infection prevention, personal care, industrial, and construction. The Engineered Materials segment consists of stretch and shrink films, converter films, institutional can liners, food and consumer films, retail bags, and agriculture films. It serves markets, such as beverage, food, and beverage.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
| P/E RATIO: | PASS |
| EPS GROWTH: | FAIL |
| FUTURE EPS GROWTH: | FAIL |
| SALES GROWTH: | PASS |
| TOTAL RETURN/PE: | PASS |
| FREE CASH FLOW: | PASS |
| EPS PERSISTENCE: | FAIL |
Detailed Analysis of BERRY GLOBAL GROUP INC
PENTAIR PLC (PNR) is a mid-cap growth stock in the Misc. Fabricated Products industry. The rating according to our strategy based on John Neff is 60% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Pentair plc is a provider of water solution to homes, business and industry around the world. The Company operates in two segments: Consumer Solutions and Industrial & Flow Technologies. Its Consumer Solutions segment designs, manufactures and sells residential and commercial pool equipment and accessories, and commercial and residential water treatment products and systems. Its pool equipment and accessories include pumps, filters, heaters, lights, automatic controls, automatic cleaners, maintenance equipment and pool accessories. Its water treatment products and systems include pressure tanks, control valves, activated carbon products, conventional filtration products. Its Industrial & Flow Technologies segment manufactures and sells fluid treatment and pump products, and systems, including pressure vessels, gas recovery solutions, membrane bioreactors, wastewater reuse systems and membrane filtration, separation systems, water disposal pumps and water supply pumps.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
| P/E RATIO: | FAIL |
| EPS GROWTH: | FAIL |
| FUTURE EPS GROWTH: | PASS |
| SALES GROWTH: | PASS |
| TOTAL RETURN/PE: | PASS |
| FREE CASH FLOW: | PASS |
| EPS PERSISTENCE: | FAIL |
Detailed Analysis of PENTAIR PLC
CRANE CO. (CR) is a mid-cap growth stock in the Misc. Fabricated Products industry. The rating according to our strategy based on John Neff is 42% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Crane Co. is a diversified manufacturer of engineered industrial products. The Company's segments include Aerospace & Electronics, Process Flow Technologies and Payment & Merchandising Technologies. The Aerospace & Electronics segment supplies critical components and systems, including original equipment and aftermarket parts, primarily for the commercial aerospace and military aerospace and defense markets. The Process Flow Technologies segment is a provider of engineered fluid handling equipment for critical performance applications. The segment consists of process valves and related products, commercial valves, and pumps and systems. The Payment & Merchandising Technologies segment consists of Crane Payment Innovations (CPI) and Crane Currency. CPI provides high technology payment acceptance and dispensing products to original equipment manufacturers, and for certain vertical markets, it also provides currency handling and processing systems.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
| P/E RATIO: | FAIL |
| EPS GROWTH: | PASS |
| FUTURE EPS GROWTH: | PASS |
| SALES GROWTH: | FAIL |
| TOTAL RETURN/PE: | FAIL |
| FREE CASH FLOW: | PASS |
| EPS PERSISTENCE: | PASS |
Detailed Analysis of CRANE CO.
More details on Validea's John Neff strategy
About John Neff: While known as the manager with whom many top managers entrusted their own money, Neff was far from the smooth-talking, high-profile Wall Streeter you might expect. He was mild-mannered and low-key, and the same might be said of the Windsor Fund that he managed for more than three decades. In fact, Neff himself described the fund as "relatively prosaic, dull, [and] conservative." There was nothing dull about his results, however. From 1964 to 1995, Neff guided Windsor to a 13.7 percent average annual return, easily outpacing the S&P 500's 10.6 percent return during that time. That 3.1 percentage point difference is huge over time -- a $10,000 investment in Windsor (with dividends reinvested) at the start of Neff's tenure would have ended up as more than $564,000 by the time he retired, more than twice what the same investment in the S&P would have yielded (about $233,000). Considering the length of his tenure, that track record may be the best ever for a manager of such a large fund.
About Validea: Validea is aninvestment researchservice that follows the published strategies of investment legends. Validea offers both stock analysis and model portfolios based on gurus who have outperformed the market over the long-term, including Warren Buffett, Benjamin Graham, Peter Lynch and Martin Zweig. For more information about Validea, click here
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
