In addition to exclusive contracts with The Boeing Company (NYSE:BA) and the Commercial Aircraft Corporation of China, airlines across the world such as Qantas, AirAsia, and Southwest have already ordered LEAP engines, according to information by General Electric Company (NYSE:GE).
Peer comparison
There are no direct competitors with Albany International Corp. (NYSE:AIN)’s machine clothing segment with a meaningful market capitalization above $200 million. I included peers with aerospace exposure, B/E Aerospace Inc (NASDAQ:BEAV) and LMI Aerospace, Inc. (NASDAQ:LMIA) for comparison purposes.
B/E Aerospace is the world leader in aerospace fasteners and consumables distribution and aircraft cabin interior products manufacturing. B/E Aerospace Inc (NASDAQ:BEAV) does not benefit equally from growth in every single type of aircraft; increased wide-body aircraft deliveries will be much more positive as they drive refurbishment and retrofitting opportunities. Given the fragility of airlines, it will be comforting for investors to know that B/E Aerospace Inc (NASDAQ:BEAV) has a diversified revenue base, with The Boeing Company (NYSE:BA) and Airbus accounting for less than one-fifth of revenue.
LMI Aerospace, Inc. (NASDAQ:LMIA) is a supplier of structural assemblies, kits, and components to aerospace companies. On one hand, it is a beneficiary of an increase in outsourcing by aircraft manufacturers; on the other hand, it faces competition from foreign aerospace manufacturers with lower labor costs. LMI Aerospace, Inc. (NASDAQ:LMIA)’s top six customers, including Boeing, represented more than three-quarters of its fiscal 2012 revenue. This customer concentration risk is partly mitigated by the fact that its customers value its services — LMI Aerospace was recently awarded by The Boeing Company (NYSE:BA) with the “Supplier of the Year” Award.
Conclusion
Investing is all about profiting from varying perceptions. In this case, the ‘quality’ of Albany International Corp. (NYSE:AIN) has been factored into the stock price, which is close to its five year high. Patience is the most important virtue for investors when they come across good companies at unattractive prices.
The article Should You Buy This Stock That Combines Stability and Growth? originally appeared on Fool.com and is written by Mark Lin.
Mark Lin has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Mark is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.
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