Wade, I think you answered your own question. If you have identified these companies (and I'm most familiar with ALDA) as being cyclical in nature, then yes, they are probably being pressured as some shareholders sell because of the anticipation of a slowing economy in future quarters.
ALDA is a supplier of golf shafts; golf is probably not a "growth" market and Aldila has been able to grow its sales by taking market share at the premium end of the market. This trend has been ongoing for several years and they've done a nice job of improving margins and earnings as a result. How much farther can they go? Backlog growth slowed down in its most recent quarter, but they do have a new shaft hitting the market. I think the jury is still out here, but caution is warranted.
The TTM PE is low (11-12x), but I think there is some anticipation of slower sales growth in upcoming quarters. Market is always looking out 6 mos and the most difficult thing to anticipate is a shrinking PE multiple when no perceptable change in business has occurred. Earnings may be solid for ALDA (and with the other stocks you mentioned) but if investors view the future eps growth outlook as being slower than in the past, they won't give a high multiple on either trailing or future PE. Value stocks can sometimes become "value traps" in a slowing economy.
AI
