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Validea's pick of the week provides a detailed report on a company that scores well in the stock-screening service's model portfolios. On Validea.ca, investors can analyze 1,000 Canadian stocks through 12 different guru-based models and get individual reports on each company. Globe Investor has a distribution agreement with Validea.ca. Try it.
Applied Industrial Technologies Inc. is a distributor and supplier of industrial products, including bearings, power transmission components, fluid power components and systems, industrial rubber products, linear motion components, tools, safety products, and other industrial and maintenance supplies. It has a market cap of $1.6-billion (U.S.).
The company has grown earnings per share at a solid 14-per-cent pace over long term (using an average of the 3, 4, and 5-year EPS growth rates).
It has a 2.8-per-cent dividend yield. It trades for just 13.9 times trailing 12-month EPS. That, its dividend, and its growth rate make for a strong 0.82 yield-adjusted PE-to-growth ratio, part of why the Peter Lynch-based model has strong interest.
The company has excellent 0.58 price/sales ratio. It has $617-million in net current assets vs. $387-million in long term debt, which the Benjamin Graham-based model likes. It has a 3.3 current ratio, which the Graham model also likes.
The company has a solid 15-per-cent return on equity
John Reese is long AIT.
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