Re CHMT - i have no clue how the polyurethane or bromide business is going to perform. Bromides are used in flame retarders, so it might get an uplift, if commercial production picks up.
I don't agree with your other statement, that quality of product and "management relationships" matter. Sure, the quality needs to be there, but what do management relationships have to do with success in a commodity business (unless the company operates in a corrupt environment)? In a commodity business, the three variables that matter are 1) price, 2) price and 3) price. To win on price, you must have low costs.
I think CHMT low gross margins show that the company has no edge there. Maybe they can sell the AG business for a rich multiple, but this is also there best performing business in terms of growth and earnings, so i wonder how they replace this profit source, because their other business lines don't look strong to me.
Good luck with this stock. I looked at is for maybe 1h and cannot find a compelling reason look deeper, or much less to invest in it. it's just not the kind of stock and/or the type of value stock that I am looking for, which does not mean it won't work for others. |
