The Wrap - Here We Go... AGAIN!
Don't try to over-intellectualize what's going on. Also, doing a live broadcast here with Al Lewis of Business Blunders on Monday. Details below.
▶Before we get going, if you missed my Red Flag Alert on ESAB Corp., you can read it here…
ESAB may not be a headline name. But as a spinout from a company created by the Rales Brothers, perhaps best known as the founders of Danaher DHR 0.00%↑, ESAB has as good a DNA as any. My focus, as increasingly seems to be the case lately, is on a false narrative being spewed by management… in this case, that ESAB is a “premier industrial compounder.” Spoiler alert: It’s not.
Not that it matters… at least not right now. Like every other stock that wasn’t nailed down yesterday, ESAB ESAB 0.00%↑ spiked 10%, prompting one premium subscriber to say…
Seems like there are easier shorts. This company is over 100 yrs old and is in a good business with recurring revenue. The multiple is much cheaper than LECO, the other US welding champ. I wouldn’t want to be short this in front of US reindustrialization & a mammoth Middle East reconstruction effort. ESAB has mfg facilities in Saudi Arabia and is positioned to benefit.
To which…