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Politics : High Tolerance Plasticity

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To: Libbyt who wrote (10478)	11/12/2001 5:22:16 PM
From: The Ox	Read Replies (1) of 23153

Hi libbyt, I don't see the appeal to owning HOC, so maybe you can shed some light on it. Operating expense and SGA are up over 11% from the previous year and the management recently was touting a "cost reduction" efficiency effort? Sure, the industry's margins exploded in the company's favor this year but I'm not sure that's going to continue going forward. My reaction after looking at the company is that they are hitting on all cylinders right now. With this vertical market-refining, I'm wondering if it's time to consider taking some of your investment off the table and waiting for the next industry downturn before reloading. The stock has roughly tripled over the past year or so. Another thing that would concern me going forward will be the tougher year over year comparisons. Maybe I'm off base here but it seems to me that the company is counting on the current high margins to continue going forward instead of expense reductions, just in case there are lower margins for the industry in the future. I'm curious if you (or anyone else for that matter) have some input on these concerns. I'd hate to dismiss an opportunity because of "faulty" reasoning. tia mh

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