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Non-Tech : Rubbermaid (RBD)
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To: Wallace Rivers who wrote (1)1/14/1997 8:43:00 PM
From: Todd King   of 45
 
Hi Wallace. I have been following RBD for over a year, and have spent quite a bit of time recently researching them. The issue, over which there seems to be some question is the one around resin costs. Most forecasts that I have seen do not forecast the price of PE resins falling significantly in the next year or so, which is bad for RBD. I would guess that the Wall Street analysts are looking at the same ones. My instinct, however, tells me that prices will ultimately fall, as new capacity is brought on. Also, new technology should help to lower the manufacturing costs for PE, which should ultimately help RBD. I guess another wildcard here is the price of oil/natural gas liquids, the main feedstocks for making PE.

I am hoping that RBD using this period of constricted margins to get their cost structure (ex. raw materials) in order.

Would be interested in thoughts of others on this point.
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