MHK - Embedded Expectations Analysis - 2020 03 27
ï€ Mohawk Industries, Inc. (MHK:USA) currently trades well below corporate averages relative to UAFRS-based (Uniform) Earnings, with a 13.9x Uniform P/E, suggesting somewhat bearish expectations for the firm. Moreover, management may be concerned about their volume and demand weakness, their product portfolio, and cost headwindsï€ Specifically, management may be concerned about continued weakness in volumes, particularly in their global ceramic and flooring North America segments, and about further increases in wages and benefits. Furthermore, they may be exaggerating innovations in their product portfolio, and they may lack confidence in their ability to execute their strategy to enhance plant performance. They may also be downplaying the exposure of their European business segment to countries facing economic difficulty, and they might have concerns about the impact of reduced production in North American ceramic plants. Finally, they may be concerned about continued weakness in demand in the U.S.
Mohawk Industries is a global flooring manufacturer for residential and commercial spaces around the world. The company has three segments: Global Ceramic, which designs, manufactures, sources, distributes and markets a line of ceramic, porcelain and natural stone tile products used for floor and wall applications; Flooring North America, which designs, manufactures, sources and distributes broadloom carpet, carpet tile, rugs and mats, carpet pad, laminate, medium-density fiberboard, luxury vinyl tile (LVT) and sheet vinyl; and Flooring Rest of the World, which designs, manufactures, sources and distributes laminate, LVT and sheet vinyl, wood flooring, broadloom carpet and carpet tile collections.
In 2009, just as the dust was settling from the last major equity and credit market crises, we launched a boutique research firm with the intention of breaking Wall Street’s biases and broken incentives:
- GAAP and IFRS have failed to provide rules for reliable financial statement reporting
- Stock analyst recommendations are not grounded in disciplined financial analysis
- Credit agencies have been set up to grossly fail in their responsibilities to investors and the public markets
- Utter lack of willingness of major research firms to employ the the most advanced forensic analysis available
We sought to provide investors and company analysts with a source of information that changed all that.
Many years later, our business model remains because little has changed on Wall Street.
- Corporate credit ratings remain years behind the fundamental underpinnings of company performance
- Stock analysts continue to make recommendations with deeply inherent biases
- Research firms have failed to break down the walls between credit, equity, and macroeconomic research
- The governing accounting bodies have created more leeway for mis-estimates and mis-classifications as financials have become unwieldy and overwhelming
The integrity of Valens Research is founded in our disciplined processes and analytics. No “star” analysts. No corporate advisory relationships. No-nonsense opinions and recommendations.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.