Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, diversified manufacturer National Presto Industries (NYSE: NPK ) has earned a coveted five-star ranking.
With that in mind, let's take a closer look at National Presto's business and see what CAPS investors are saying about the stock right now.
National Presto facts
||Eau Claire, Wis. (1905)
||Aerospace and defense
Chairman/CEO Maryjo Cohen (since 1994)
CFO Randy Lieble (since 2008)
|Return on Equity (Average, Past 3 Years)
||$112 million / $0
L-3 Communications (NYSE: LLL )
Procter & Gamble (NYSE: PG )
Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS. *Reflects special dividend.
On CAPS, 98.5% of the 536 members who have rated National Presto believe the stock will outperform the S&P 500 going forward. These bulls include All-Star davethewav9, who is ranked in the top 15% of our community, and glenvar.
Earlier this summer, davethewav9 offered a balanced take on National Presto: "Has some risks in that Gov contracts for ammunition could be lost or scaled back or [Wal-Mart] could stop carrying products, but if not the case, this is severely discounted even for a small growth rate. Stellar stewardship and great dividend, great ROE, great balance sheet."
In fact, National Presto boasts over $110 million in cash on its balance sheet with zero debt. Meanwhile, defense industry peers L-3 and Boeing (NYSE: BA ) sport a debt-to-equity ratio of 59% and 241%, respectively, while consumer-product competitor Procter & Gamble has debt-to-equity of 47%.
CAPS member glenvar elaborated on the National Presto bull case in late July:
This stock returns cash to the shareholders rather than spending it on misadventures as some other companies do. Also a lot of its competition in the small appliance sector has gotten out of the business. It has a clean balance sheet (no debt), the earnings have grown at a 23% rate over the past 5 years (including 3 recession years) and it is trading at an 11 P/E on trailing earnings.
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