WIRE -- Contrarian Alert!
Encore Wire Corporation (NASD WIRE@ $24.65) is a low-cost manufacturer of copper electrical building wire and cable. Encore supplies both residential wire for interior electrical wiring in homes, apartments and manufactured housing, and commercial wire for electrical distribution in commercial and industrial buildings. The principal customers for the Company's wire are wholesale electrical distributors, which serve, both, the residential and commercial wire markets. Encore sells its products primarily through manufacturers' representatives located throughout the United States and, to a lesser extent, through its own direct in-house marketing efforts.
Market Cap (intraday): 586.54M
Trailing P/E (ttm, intraday): 4.14
Forward P/E (fye 31-Dec-07): 6.50
Price/Sales (ttm): 0.48
Price/Book (mrq): 1.86
EBITDA (ttm)/Revenue (ttm): 5.1
Qtrly Revenue Growth (yoy): 79.80%
Qtrly Earnings Growth (yoy): 219.20%
Book Value Per Share (mrq): 13.805
52-Week High (09-May-06)3: 47.35
52-Week Low (10-Nov-05)3: 21.63
Shares Short (as of 10-Oct-06): 7.35M
Short Ratio (as of 10-Oct-06): 10.6
Our Earnings/share estimate for 2007: $3.70 per share
Insiders' and institutional support:
Each of 10 mutual funds holds WIRE as one of its top holdings.
Insiders purchased in May,2006 at price 50% higher than current market's.
Capitulated Volume: Wire traded 12,741,000 shares on Oct. 23 vs. a 3-month average daily volume of 779,676 shaes.
Conclusion: Value + insiders and institutional support + capitulated volume = Timely contrarian investment with favorable risk/reward potential.
pcyhuang
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