Very solid first quarter 2011 for Colfax!
Colfax (NYSE: CFX) did beat expectations.
As this is perhaps more important for short term oriented investors their numbers really underlign some nice trends:
Net sales up 32%
operating income up 57%
Net earnings up 69%
… Margin improvements! All segments exept defense contributed to these results.
Order backlog at the end of the quarter stood at $ 369.8 mil, 31,5 % higher than one year ago.
Here one can clearly see the positive impact of their acquisition strategy: The acquired companies alone contributed 27.3% to this order backlog growth!
The balance sheet remains strong, but it is interesting how they ramp up inventories:
most important – the inventory component „work in progress” is up 60% as you can find if you dig into the 10 Q-report they already filed. A positive sign!
On the statement of operations 2 legacy components are down:
Asbestos liability and defense cost is down 7% and
Asbestos coverage litigation expense is down 48%
Let’s hope this positive trend continues and Colfax can get rid of this legacy costs over time!
Colfax stock trades at a p/e of 18 and at a p/last year free cash flow of equally 18
If you did not already buy perhaps wait for the next dip!