Friday, March 18, 2011
A Company that "Does Windows"
Many domestic workers limit their exposure to hard work by refusing to wash windows and other back breaking tasks. Solutia, Inc. (SOA: NYSE) is a
U.S. company that is actually competing to do all the windows in . Solutia performance films division produces window film that can save up to 80% on energy requirements by reducing heat loss in cold months and solar penetration in hot months. China China’s residential and office building boom is a highly lucrative market and Solutia has set up a sales office in to pitch its performance films as well as films for solar cells. China
Solutia has some competition in the
market. 3M Company (MMM: NYSE) is another China U.S. producer of performance films with a sales presence in Asia. There are a number of China companies producing window films and Australia-based Hanita Pacific (formerly Film Pacific) has its eye on as well. Solutia management has been promoting the idea of building standards in China that would help weed out the lower quality products and perhaps provide customers with more confidence in the industry. China
Solutia manufactures of a variety of performance materials and specialty chemicals. The company reported $2.0 billion in total sales in the year 2010, providing $87.0 million in net income. Demand conditions are looking good for Solutia and on a restructured capital base the Company expects to report strong earnings in 2011.
Investors have not caught up with the change of fortunes for Solutia. Against the consensus estimate, the stock is valued at 9.1 times earnings. We view the valuation as compelling at the current price level even after a steady increase in the stock price over the last several months.
Neither the author of the Small Cap Strategist web log, Crystal Equity Research nor its affiliates have a beneficial interest in the companies mentioned herein.