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Simpson Manufacturing Co., Inc (SSD)

Jiazi Cui Ying Jiang Presented: April 24, 2014. Simpson Manufacturing Co., Inc (SSD). Agenda. Company Overview Relevant Macroeconomic Trends Industry Structure Analysis Financial Analysis Projections/Assumptions Valuation Recommendation. Company Overview. Sales Distribution.

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Simpson Manufacturing Co., Inc (SSD)

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  1. Jiazi Cui Ying Jiang Presented: April 24, 2014 Simpson Manufacturing Co., Inc (SSD)

  2. Agenda • Company Overview • Relevant Macroeconomic Trends • Industry Structure Analysis • Financial Analysis • Projections/Assumptions • Valuation • Recommendation

  3. Company Overview Sales Distribution • Info: • Incorporated in Delaware in 1956 • 2,295 employees • Market Cap : 1.63 billion • Business: • Through Simpson Strong-Tie Company Inc. • Leading manufacturer of wood construction products and concrete construction products. • Markets: • residential construction, light industrial and commercial construction, DIY. • Channel: • Dealer, builder, home centers, and internet. • Goal: • Help people build safer and stronger homes and buildings. • Acquisition & expansion • Testing labs. By Products By Segments Source: SSD 10-K report & FOURTH QUARTER AND FULL YEAR 2013 report

  4. Products

  5. Simpson Strong-Tie Locations Source: SSD website.

  6. Management Information Source: Bloomberg

  7. Industry Overview Source: Forecasting the numbers of people affected annually by natural disasters up to 2015 By ShamanthyGaneshan, Oxfam GB, Research Intern (Economist) & Wayne Diamond, Oxfam GB, Global Research Methods Adviser , EM-DAT

  8. Industry Overview • Building Construction Construction Product demand picks up Profit improves with the demands • Industry Performance Industry revenue is expected to keep increase due to an uptick in residential and commercial construction activity. Source: Bloomberg

  9. Industry Overview • Increase in investor confidence will boost demand for this industry's services. In 2014, global investor confidence is expected to increase. • Measures private spending on home improvements, upgrades and repairs • 2012 increase 2.9% • 2013 increase 4.3% • 2014 increase 5.1% Source: Bloomberg

  10. Industry Overview • Global Steel Price Index • Global Steel Price declined • Recovery since 2015 Source: Bloomberg

  11. Porter’s Five forces

  12. SWOT

  13. Stock Performance Source: Yahoo Finance

  14. Financial Analysis • Revenue Growth Rate keep growing • FY 2012 R&D expense increase rapidly Source: SSD 2013 10-K, SSD 2010 10-K, Bloomberg

  15. Financial Analysis Source: SSD 2013 10-K, SSD 2010 10-K, Bloomberg

  16. Financial Analysis Source: SSD 2013 10-K, SSD 2010 10-K, Bloomberg

  17. Financial Analysis

  18. Comparable Companies Source: SSD 2013 10-K, SSD 2010 10-K, Bloomberg

  19. Comparable Companies Source: SSD 2013 10-K, SSD 2010 10-K, Bloomberg

  20. Revenue Forecast Source: SSD 2013 10-K, SSD 2010 10-K, Bloomberg

  21. Cost of Capital Source: SSD 2013 10-K, SSD 2010 10-K, Bloomberg

  22. Valuation-DCF

  23. Valuation-DCF

  24. Valuation-DCF

  25. Implied Share Price Current Stock Price: $33.84

  26. Recommendation Watch List

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