Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, Chinese chemical company Chemspec International
With that in mind, let's take a closer look at Chemspec's business and see what CAPS investors are saying about the stock right now.
|Headquarters (Founded)||Shanghai, China (1996)|
|Market Cap||$271.9 million|
|Trailing-12-Month Revenue||$149.9 million|
Chairman/CEO Jianhua Yang
CFO Zixin Wang
|Trailing-12-Month Operating Margin||26.8%|
|Cash/Debt||$22.5 million / $13.5 million|
Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 99% of the 124 members who have rated Chemspec believe the stock will outperform the S&P 500 going forward. These bulls include Nestorvestor and All-Star mrindependent, who is ranked in the top 2% of our community.
Late last year, Nestorvestor offered some thoughts on CEO Jianhua Yang's recent proposal to take Chemspec private: "The company board received an buyout offer from the CEO, who already owns more than 50% of stock, for $8 per ADS. ... I think this is a lowball offer. ... If we take to account the pure cash flow and ROE the company should be valued near $14."
In fact, Chemspec currently trades at a forward P/E of just 7.4. That's a clear discount to listed rivals Balchem (25.2) and Sigma-Aldrich (17.1), as well as much larger chemical plays like Ashland
CAPS All-Star mrindependent elaborates on the bull case:
This well positioned Chinese manufacturer of flourinated chemicals enjoys a diverse customer base and thrives by tailoring its products to the specific needs of its customers. The CEO has offered to purchase the company for $8.00 per ADR, but this offer seems way too low. Although I don't like to see the CEO pushing out other shareholders, I do applaud his commitment to the firm. The company's balance sheet is cash rich. ... I am reassured that the auditor is KPMG.
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