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Universal Stainless & Alloy Products Looking To Ride An Improving Mix And Strong Aerospace

I thought Universal Stainless & Alloy Products (USAP) shares looked pricey in April of 2014. While the shares have lost about a quarter of their value since then, the truth is that virtually every specialty alloy producer this side of Outokumpu saw a big decline over that stretch.

While the shares were selling off the company was making progress. Full-year revenue rose 14% for 2014 and gross margin more than doubled. USAP still has work to do in growing the high-ASP vacuum induction melted (or VIM) product business, but even after adjusting for the slower VIM ramp and the potential impact of lower oil prices and weaker off-highway vehicle demand, these shares are looking quite a bit more interesting at today's price.

Improvements Continue in Q4

USAP is barely covered by the sell-side, so decide for yourself what a beat relative to a two-person consensus really means. More important… Read More …