Recs

9

4-Star Stocks Poised to Pop: WESCO

Based on the aggregated intelligence of 135,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, electrical supplies distributor WESCO International (NYSE: WCC  ) has earned a respected four-star ranking.

With that in mind, let's take a closer look at WESCO's business and see what CAPS investors are saying about the stock right now.

WESCO facts

Headquarters (founded)

Pittsburgh (1988)

Market Cap

$1.02 billion

Industry

Electronics Wholesale

TTM Revenue

$5.4 billion

Management

CEO Roy Haley (since 1994)
CFO Stephen Van Oss (since 2000)

Return on Equity (average, last three years)

32.5%

Competitors

Fastenal (Nasdaq: FAST  )
MSC Industrial (NYSE: MSM  )

CAPS Members Bullish on WCC Also Bullish on

General Electric (NYSE: GE  )
Johnson & Johnson (NYSE: JNJ  )

CAPS Members Bearish on WCC Also Bearish on

GigaMedia (Nasdaq: GIGM  )
Greenbrier (NYSE: GBX  )

Sources: Capital IQ, a division of Standard & Poor's, and Motley Fool CAPS. TTM = trailing 12 months.

Over on CAPS, fully 188 of the 195 members who have rated WESCO -- some 96% -- believe the stock will outperform the S&P 500 going forward. These bulls include All-Star mrindependent, who is ranked in the top 3% of our community, and notzia.

Just last week, mrindependent noted that as "a provider of electrical construction products, Wesco International should benefit from a recovery in the worldwide economy." Our CAPS All-Star concludes: "It looks like a reasonable value even though it has increased quite a bit from its March lows."

In a pitch from the same day, notzia also offered an electric analysis. Here's an excerpt:

WESCO International, Inc. (WCC) is a provider of electrical construction products and electrical and industrial maintenance, repair and operating supplies (MRO).

The EPS has shown solid growth over the last eight years, with a compounded annual rate of 42%. Although the free cash flow has been positive throughout this time, it has fluctuated substantially; the last four years have been far better than the earlier four. In general, the return on equity (ROE) has been increasing from the [15%] evidenced in 2001 to the [35%] found in 2007; in 2008, it fell to the more pedestrian [31%].

Based on value and safety, I think [WESCO] has good investment potential.

What do you think about WESCO, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. More than 135,000 investors are waiting to hear what you have to say. CAPS is 100% free, so simply click here to get started.

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Fool contributor Brian Pacampara owns no position in any of the companies mentioned. MSC Industrial is a Motley Fool Stock Advisor selection, Johnson & Johnson is an Income Investor choice, and GigaMedia is a recommendation of Rule Breakers. The Fool's disclosure policy always gets a perfect score.


Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On August 11, 2009, at 1:21 PM, plange01 wrote:

    with the prime rental season ending in a little over a month and the false stock market rally over the great run in car rentals stocks..car,dtg and htz has ended.these were among the top gainers for 2009

  • Report this Comment On August 14, 2009, at 10:46 AM, usgoods wrote:

    The P/E ratio is around 6.1 which is rather low. S&P gives wcc a fair value calculation of $40.10 which is far higher than the current price of under $23.00. The company has a lot of debt, but they are paying it down quickly by not paying dividends. I personally am investing in wcc and believe it will shoot up real soon.

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