Savvy Trades and Investments

[SSKILLZ1]

MYE

I brought a small position of MYE today at $12.49, here is what I like.

1) Has a nice Divy of about 4.3% so you get paid while you wait.

2) MYE is guided for $1.30-1.45 this fy, as this is a transition year of this growth story digesting the gains in earnings over the last several years. The stock only trades at less than 10 times this year. This stock historically could trade closer to a 15x multiple and some peers trades at even higher multiple than this.

 
 2016 $0.48 
 2017 $0.51 
 2018 $0.76 
 2019 $0.78 
 2020 $0.85 
 2021 $0.97 
 2022 $1.68 (Outrageous Jump hence the digesteion for a couple of years.) 
 2023 $1.39 
 2024 $1.30-$1.45 (Estimated) 
 

As you can see from this chart that longer-term this company has had great success in growing earnings.

3) MYE says there 5 year plan of growing adjusted earnings should take us to north of $2.00 in fy 2026, and north of $3 in fy 29. From the slides of there investor day presentation in March. Anlayst estimates are looking for $1.70 in fy 25. If they deliver those numbers I believe the stock could easily return to the low to mid 20's, which is a great return from the mid 12's.

Conclusion: To recap the stock has dropped from like $23 since early May, your buying at multi year lows, getting paid a solid 4.3% dividend, the company is way oversold with a RSI of under 16 (Which is absurdly oversold). Historically has traded around a low to mid teens multiple, and in the investor day plan FY 25 to be a year of significant growth and 2026 to reach over $2.00 adjusted eps. The company has in the long run proven to be a good grower of earnings, and I expect that to continue. The reason why I plan to keep this position smaller is twofold, more economically sensitive, although they are focus of growing their business in a lot less economically sensistive areas or less sensitive so that is a plus, and they did have a lighter q1, I expect this year to come in at the low end of guidance, so although I'm bullish about FY 25 and beyond, I do admit some of the upcoming comps might not be the greatest either, but should start improving in the 2nd half and beyond. All is just my opinion, and I could always be wrong though.