INDUSTRIALS SECTOR
Sukumar Madugula MBA 7225 – Student Stock Market
July 8, 2015
• Sector Overview
• Business Analysis
• Economic Analysis
• Financial Analysis
• Valuation Analysis
• Recommendation
Industrials Sector • Cyclical • Capital Goods - manufacture and
distribution including – Aerospace & Defense – Construction – Engineering & Building Products – Electrical Equipment – Industrial Machinery
• Services – Transportation – Printing, Office Supplies – Couriers
Sector Overview
Sector Overview
Industrials sector is 17% of S&P 500 Mkt Cap. As of 7/3/15, Recommend Overweight +0.30%
Sector Overview
Sector Overview
Sector Overview
Sector Overview
Industry Overview
Industry Overview
Industry Overview
Industry Overview
Business Analysis
Business Analysis
Absolute and Relative Valuation of Industrials vs S & P 500
Valuation Analysis
Economic Analysis
Economic Analysis
Porter’s Five Forces
Business Analysis
Financial Analysis
Financial Analysis
Valuation Analysis
Recommendation
Recommendation
• SIM is currently underweight. Need to increase to recommended weight to match S&P 500 recommended weighting.
• Reasons:
– Cyclical industry closely trends S&P 500
– Better unemployment results
– More investments prior to interest rate increases to avoid capital increases.
