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You are one of many people from the old mania days who have written lately, stating that they went high, fell back a bit, got out and are now considering wading in a toe at a time. Walter Industries (WLT:NYSE - news - commentary - research - analysis) is an interesting reorganization story down in Florida. It operates businesses in iron pipes, foundry coke, aluminum, single-family homes, modular homes, home financing, water, coal mining and methane gas. Management, which is affiliated with the leveraged-buyout firm KKR, is trying to streamline operations, and they seem to have a decent chance of getting more out of less. Its management has certified its financial statements, and it recently raised earnings guidance for the current fiscal year. Cash flow is improving, and debt is being repaid. If you think the economy is improving, this relatively cheap potential turnaround stock could offer some decent upside, possibly to $16 or better in a year from its current perch around $12.25. One way to play it might be to attempt to purchase it on a buy stop at $13 to clear local resistance, with a stop-loss around $11. Look out for a potential double-top at $15. |
