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Baldor Electric: Market Position and Potential Growth Analysis

Learn about Baldor Electric's major products, market share, industry investigation, and growth trends. Explore their position in the industry, growth rate compared to competitors, and stock valuation analysis. Discover why investing in Baldor stock could be advantageous based on current market trends.

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Baldor Electric: Market Position and Potential Growth Analysis

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  1. Baldor Electric – NYSE (BEZ) Presentation by: Cole Stocking, Neal Smith, & Darron Campbell

  2. Basic Business of BEZ • Major Products: Electrical Components to include the following: • Electric motors (both AC & DC) • AC & DC Controls (Inverters, Microdrives, Integral Tachometers, & & Lifting Magnets) • Gear Products (AC & DC Gear Motors, Speed Reducers) • Market Share • Baldor is the largest manufacturer of AC & DC Electric Motors • Account for roughly 13% of the Electrical Component Industry

  3. Industry Investigation • General Growth of Industry • Large increase in industry size following the Korean War • Continued increase til early 2001 at which time industry leveled off with frequent increases and decreases • Position in Industry • Assumes 13% of the Electrical Component Industry • Considered Average amongst • Average Growth Rate Compared to Industry • From 1998-2008 – Baldor stock grew 6.3% • From 1998-2008 – Industry grew roughly 9.3% • Average Price Ratio Compared to Industry • Baldor average P/E Ratio is 17.12 • Industry Average P/E ratio is 24.78

  4. Fair Value of Baldor Stock Current Price $ 27.94 • P/E Ratio $43.16 • P/CF Ratio $33.68 • P/S Ratio $32.55 • Baldor stock is undervalued

  5. Buy/Sell Recommendation • BuyBaldor stock based on the Price Ratio Analysis on previous slide which indicates that Baldor stock is currently undervalued; therefore, we believe that it will grow closer towards its fair value by year end.

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