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 Nalco Holding
So what: The water-treatment and energy specialist headlined "strong" full-year earnings for 2010, but contrast that with what Reuters describes as a "weak" 2011 forecast. The market, as you would expect, is focusing on the latter.
Now what: The big concern is rising raw material costs, which have a big effect on Nalco. In the conference call today, CEO Erik Fyrwald said his company has made a number of price increases to help offset the costs. These increases, he said, "have had reasonable reception from our customers." Look for the increases to flow back through the business in the next couple of quarters.
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