DEEP VALUE: Regal Beloit
Market cap: $1.3 billion
P/E ratio: 12
Current ratio: 2.5
Dividend yield: $1.6%
Smart acquisitions helped this manufacturer of heating and air-conditioning products book a record $2.2 billion in revenue for 2008, despite dramatically higher raw material costs and a big slowdown in the economy.
Baird analyst Michael Schneider says that a series of government actions should lift the company's earnings in 2010. These include the $1,500 rebate in the stimulus package for high-efficiency residential air conditioners, furnaces, and heat pumps and a $4.2 billion allocation to make federal buildings green. Finally, the 2007 Energy Act raises minimum efficiency ratings on industrial motors by 30%, effective by the end of 2010.
--K.B.
NEXT: DEEP VALUE: Valmont
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Unilever
Last updated June 11 2009: 10:27 AM ET
Criteria include prices no more than 15 times average earnings per share over the past three years, 10 years of positive earnings, annual per-share earnings growth of 3% or more, 10 years of uninterupted dividends, and curent ratio (assets divided by liabilities) of 2 or better. All data related to stock price as of June 1, 2009. P/E ratios based on average three-year earnings.
