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Gehl is my largest holding -- but I'm diversified, so that's less than 10% of my equity, which is currently a small part of my portfolio (I'm nervous, and have lots of cash). I have no idea about Gehl as a takeover candidate, but I'm inclined not to believe it. Management set a poison pill in '97 when someone bought a bunch of stock. Gehl's a cyclical company, and the last five years have been part of the same up cycle, especially in the light construction business. So, while I like management and the company, I'm not sure I'd recommend new purchases at current prices. For me to buy a cyclical at the top of a cycle, the P/E has to be under 5. Come back after the cycle turns, Gehl's business and earnings look terrible, the stock has been pummelled and the PE is high (lower denominator => higher ratio). -mb |
