Why Quantex Building Products Corporation's Shares Jumped Today

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Quanex Building Products Corporation (NYSE: NX  ) jumped as much as 11% today after announcing an asset sale.

So what: Quanex is selling a Nichols Aluminum, LLC, a subsidiary that makes flat-rolled aluminum sheet products, to Aleris for $110 million in cash. This will allow the company to focus on its main market, supplying products for the window and door industry.  

Now what: Management is seeing an opportunity to focus on the growing housing and commercial building markets. The company has very little debt so this makes the balance sheet even more attractive, but the success of the deal will come down to Quanex growing the remaining business. It's been holding near break even but investors are expecting a jump in profit this year and next, so keep an eye on performance this year.

A top stock for today's market
There's a huge difference between a good stock and a stock that can make you rich. The Motley Fool's chief investment officer has selected his No. 1 stock for 2014, and it's one of those stocks that could make you rich. You can find out which stock it is in the special free report "The Motley Fool's Top Stock for 2014." Just click here to access the report and find out the name of this under-the-radar company.


Read/Post Comments (0) | Recommend This Article (0)

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.

Be the first one to comment on this article.

DocumentId: 2833014, ~/Articles/ArticleHandler.aspx, 4/20/2014 10:53:25 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement