The Mess at Manitowoc

• Report this Comment On April 01, 2009, at 4:53 PM, investish wrote:

  After reading this article I find it interesting that TMF owns shares of Manitowoc's competitor Terex while TEX has also warned on their debt covenants. Bottom line is their whole industry is in a very sticky spot right now so it irks me to see all of the negativity flying around just about MTW. If you ask me, I believe that in the future we will need cranes and heavy machinery. On that note I will have to disagree with the author and suggest that buying into heavy machinery while the sector is weak is a good idea as long as you keep it diversified. I think MTW is worth considering just based on the fact that they are severely undervalued. S&P fair value calculation is $6.50. To be fair I disclose that I own shares of MTW.

• Report this Comment On April 01, 2009, at 5:03 PM, texsurferFOOL wrote:

  I have very little money to invest but I bought a little bit of MTW, DE, and CAT about 30% ago. They are all super solid companies and lead their industry in brand name recognition and reputation. To answer your question on what synergies between crane making and food service equipment, I would have to say that DIVERSIFICATION may have been a goal in that situation. I don't know but that would be the only logical explanation without further research.

• Report this Comment On April 01, 2009, at 5:08 PM, grangranina wrote:

  You people make my nerves hurt with all of this negative vibes that you come across with. You said you wondered what fool could tell you why Manitowoc would want a food company as part of their business. I can tell you that it is because they already have a refrigeration segmant with them and all through the years it has made a profit and a fairly large one at times. I know because I worked for this part of it for a lot of years. Needless to say, I have got stock in this company and I find it hard to sit by and let somebody bad mouth them. I suppose you know that the economy is on its knees and Manitowoc is not, by far the only company having a weak time. If the economy builds back up, Manitowoc will prosper just like all of the other companies. However, If the economy fails to build up, they are all in trouble. I know that maybe they made a mistake paying that much for a new adventure but I guess they have made a lot through the years taking risks. Unfortunately, this wasnt one of them. They will survive. They dont need somebody to put them down any further than they already are.

  Voicing my opinion,

  Grangranina

• Report this Comment On April 02, 2009, at 9:31 AM, Aggiemedic01 wrote:

  Personally, I'm thrilled with MTW's bid to purchase Enodis, mainly because it prevented MIDD from biting off a company that I think would have been far too big for them to digest. As a MIDD shareholder, I dodged a bullet there, but MIDD had backed out of that bidding long before the price got up to $2.7B.

  A key investing principle is not to fall in love with any one stock. Detached (or at least semi-detached) critical analysis is required to be a good investor. With the recent downturn, I've become much more focused on wanting to know what might be going wrong with the stock I own. I want to hear the best bear case that I can find.

  There seems to be a lot of love for MTW with the various objections to the "negative vibes" in this article. When I look for stock I want to see companies that stick to their bread and butter, not companies that are eager to take on debt to expand into new areas (aka deworsification). I don't follow the company closely but Enodis looks like a bad deal because it a) cost too much, b) takes management's focus off running a tight, slim ship through difficult economic times, c) doesn't enhance their core business. Its not the sort of strategic decision that gives me a lot of confidence that management has a really good grasp on where MTW is and what it needs to do to be a successful company.

  This is a company that has some serious risks and question marks attached to it. Is it a good company (and a good company to own at current prices)? I have no idea. But as investors, we MUST be aware of the risks as well as the potential rewards. I am grateful to anyone who wants to point out risks - even if I disagree.

  In today's environment, I think downside risk should be a primary concern. What if sales don't pick up to 2008 levels until say 2013-2015 (that's the time frame that the folks I know in the cement construction industry are looking at as an optimistic scenario)? How does the company look under those conditions? If it still looks good, that's great. Otherwise, there are lots of other companies out there that are dirt cheap and have minimal downside risk.

  Aggiemedic

  Long MIDD

• Report this Comment On April 02, 2009, at 1:43 PM, jmarkent wrote:

  I am really disappointed that someone such as Mr. Smith would write such a downgrading article and then admit "(Perhaps there's a Fool out there who can explain to me the logic and synergies of a crane manufacturer owning a kitchen equipment maker)" without doing his research. Manitowoc has been in the cold food and beverage industry for many years and the purchase of Enodis allowed them to diversify into the hot food and beverage side of the industry. The strategy made a lot of sense and allowed them the opportunity to be a 'one-for-all' supplier to the food and beverage industry. And had he done his research, he would know that the crane business is no longer 85% of the Manitowoc business. The sad part of this story is the bad timing of the acquisition and perhaps the price paid being more than value, primarily pressured by bidding war with ITW for the Enodis business. Manitowoc has shown to be a very strong and well managed company and will pull through this stronger than ever. Also being a share holder ,I am one that believes this a great buy opportunity, especially for the long haul.

• Report this Comment On April 02, 2009, at 2:59 PM, Stocklovr wrote:

  I like the comments this article has generated. It's interesting to see this from multiple points of view. I do, however have a question.

  Who gets to decide whether or not MTW paid TOO much for Enodis??? How much is too much? This is a subjective answer. I think you can question the timing but ITW wasn't that far behind in the bidding process. If this acquistion ends up generating decent profits in the future, then did they pay too much?

  MTW evidently doesn't think so. Obviously, they could be wrong but I don't think anyone can make a blanket statement like "they paid too much for Enodis". That remains to be seen!

  I also understand the reasoning behind the purchase. They already owned ice-makers and other refigeration equipment. I liked the idea of them not relying so much on their crane business (85% is a lot of eggs in one basket). It's still their core business. If they wouldn't have done this deal, I'm sure we would see articles talking about how risky their business is because they were so concentrated in cranes. Talk about your catch-22.

  Slvr

• Report this Comment On April 02, 2009, at 4:51 PM, texsurferFOOL wrote:

  I just can't see how buying MTW at 2.90 is a big gamble. The potential reward is so huge because as previously stated, they are a solid company with solid products. I don't invest in idea companies. Look at Yahoo and how they were on top. Now it's Google. Who is going to come knock Google off? It's a true gamble with companies like that. Nothing against them but the publics whim can change ever so slightly and put them in the crapper. It's all fun though!

• Report this Comment On April 04, 2009, at 10:52 AM, jjsschultz wrote:

  I just wanted to let people know why Manitowoc would own the cranes division along with a foodservice division. I currently reside in the Manitowoc area and the company has an amazing history with the area. If you take a look at the company just 2-3 years ago you may understand better. They used to not be part of just cranes and foodservice equipment. The Manitowoc company was into building cranes, foodservice equipment, AND shipbuilding. The company originated as a shipbuilding company. So one may also ask how it went from shipbuilding into cranes. It is simple, stay up to date with the current markets. Crane manufacturing turned into being a better market for the company so they focused more on the cranes. Also they do not only build Manitowoc Cranes, they have several facilities world-wide that also produce brands such as National, Grove, and Potain. They also produced foodservice equipment through Manitowoc Ice for many years. Recently the shipbuilding division was sold and then Enodis was purchased. So why is there such a concern with this purchase? The company is not extending into new areas; in fact, they cut down from three areas to two. Is this hard to understand? Maybe they whole story should be researched before producing a publication that will make a fool of the writer. Manitowoc Co. has gone from building cranes, ships, and foodservice equipment, down to just cranes and foodservice. Doesn't this point to them becoming more "logical" than not, as stated in the article? I think the MTW stock is a great place to buy stock. Compared to most companies out there Manitowoc is doing well. It has recovered through many hard economies before and should prevail once more. Where is the mess in this? I see them as cleaning up more than messing up. Research of a whole story is as good as gold!

• Report this Comment On April 07, 2009, at 7:59 PM, johnnyoh937 wrote:

  To be clear on a few things, MTW bought Enodis THEN sold ship building to pay down debt, hmmm 20 mm vs $2.7bil.... Next MTW has been in Food Service via several small, low end brands, they wanted to buy into this market due to the horizon of cranes crashing. They did pay too much as ITW was bidding, but was FAR below the 2.7 price. If you have ever bid against ITW you will know that they dont get emoitional or chase a business, they find a value and draw a line, MTW surpassed that line by millions upon millions. Speaking of millions while MTW is laying off workers in every division the CEO took a 40%++ pay increase this year, not bad for a company stock that has tanked! I am a buyer in the 2's and a seller in the 4's, it wont break out anytime soon ( being all of 09 and probably 10 as well)

• Report this Comment On April 08, 2009, at 2:57 PM, grangranina wrote:

  Since we are talking about the sale of ship building and the acquision of Enodis, I think the ship building part was sold before Manitowoc ever bought Enodis. We need to keep the facts straight. They may have been bidding for Enodis before they sold the ship building but they never actually bought Enodis until later. I am pretty certain that I am right about this. True, they did use the proceeds from the sale to pay on their debt. I cant really see how anybody that buys stocks in the $2. range can be hurt a whole lot. I would have held out for $5. or $6.

• Report this Comment On April 13, 2009, at 9:11 PM, backinblack09 wrote:

  What crane mnufacturer gets into the food business? Why one that already is. How long do you think Ice has been around? As far as don't buy as of the writing the stock is up 29%. That wasn't an april fools joke was it?

• Report this Comment On April 15, 2009, at 4:18 PM, manitowoceast wrote:

  Being an employee of manitowoc and see the way things are being ran now ,I am selling all my stock. I have a couple thousand shares of mtw and I think it is funny how alot of the vp's of the food service part of mtw are retiring or leaving. I don't see making money on it the way things are right now. You should look at the whole picture before buying the stock. It was a good stock a year ago and when they started with enodis it went down hill seen then.

• Report this Comment On April 15, 2009, at 9:00 PM, investish wrote:

  Wow manitowoceast did you go through all the trouble of creating an account here just to post to this one article? I didn't find it surprising in the least to see that your account was created today, that you have no stock picks, and that the first thing you did was post to this article. Anyone with any sense knows what you said here isn't credible in the least. If you want a shot at manipulating stock prices, go run a hedge fund.

• Report this Comment On April 16, 2009, at 11:28 AM, manitowoceast wrote:

  I didn't post this to manipulate stock prices. I posted this because people above like Aggiemedic01 stated they what to know about the company good or bad. I felt that hearing something from an everyday common mtw worker is what he was talking about . Everyhting I put in the post was true and being a guy with sense(investish) you can do whatever you want with the info. I did set my account up yesterday not like you did 9 months ago . Does that have anything to do with how mtw is closing one of it's factories in maryland and it was because some of the way the deal with edonis was. I guess they had to do something since they had to sell edonis ice almost 40 million less then they were suppose to. So I am sorry that I posted this before I did my stock picks and sorry to let people know alittle from people that actual work for mtw. I am still going to sell my mtw stock. You do what you want with your mtw stock.

• Report this Comment On April 16, 2009, at 3:36 PM, grangranina wrote:

  Hey, Investish, You need to stop and think. If you really do have 2000 MTW stock and you sell them for less than $5.00, you are not going to have much money to keep or to buy other stocks with either. You will only have around $10,000. I also have what I think is a lot of MTW stock and there is no way that I am going to give them away. That is just about what you are doing. If I cant sell them for more than that, I will keep them. You dont seem to understand that it is not just Manitowoc. It is just about everything down. I, too worked for them for a long time and now am retired. I had a job there for 26 years and could still be working if I had wanted to. I believe if I was so unhappy with the work place, I would get out of there and find somewhere else to work. Oh I forgot, there is not many places right now that you can go and get a job. If you still have a job there, you are fortunate. A lot of people would like to have your job.

• Report this Comment On April 22, 2009, at 5:08 PM, grangranina wrote:

  Manitowoceast,

  I just today noticed that I posted the last comment that I wrote meaning for you to read it and I posted it to investish. Anyway, you need to be careful selling your stocks for $4.00. They are almost $5.00 now. Maybe if you hold out a little longer, you could get $6.00.

• Report this Comment On April 27, 2009, at 8:06 PM, useyourhead79 wrote:

  I hav noticed there has been some uninformed people when it comes to mtw stock/news. Some writers were making the sale of enodis ice out to being the sale of the complete Manitowoc Ice busniess.. Over powering the fact that the reason for the sale demand of enodis ice was the fact that Manintowoc would hold too much volume of the cold food servies market. Which i think says alot about the DIVERSIFICATION of Manitowoc's company as a whole nw that they are giants in both of there sectors.

  Also the last time i bought mtw when under $4 I was prompted to call my broker before purchase, as a warning to the the sale of the manitowoc ice devision.. Here to find out i was more informed about the company than the broker warning me about my purchase! So i explained to him the real story and i did understand because like i said i had been reading miss reported news myself on the sale.Anyway friday will be a big day when the earning report comes out..

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