CIRCOR International

Texas (12/25/2013) – CIRCOR International, Inc. (NYSE: CIR) – Negative Investment Interest based on a recent price of $81.96 and a fair value estimate of $51-$60.

The company designs, manufactures and markets valves and other highly engineered products and sub-systems that control the flow of fluids in the energy, aerospace and industrial markets.

My issue with the stock is that pricing has far outstripped the company’s ability to earn with a one- year price increase of 131% versus a 23% y-o-y increase in sales, and an 11% y-o-y increase in earnings. Converting the y-o-y earnings growth to current pricing places the current stock price at near $84. With a recent close of near $82, the potential upside reward is far outstripped by the potential downside risk. Short players seem to agree with a current days to cover estimate of 1.7.


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