FRK – Will This Cement Leader Performs Again?

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Jan 24 2007
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Florida Rock Industries, Inc. (NYSE: FRK, stock) will announce its’ earning tomorrow, Thur Jan-25-2007 AMC. FRK is engaged in three business segments: construction aggregates, concrete products and cement and calcium products. The Company also has an investment in a crushed stone plant in Charlotte County, New Brunswick, Canada and a distribution yard in New York City, New York.

Some of the Indicators for FRK:

  • Wall Street consensus : 0.61
  • StockScouter rating : 10 / 10
  • Whisper Number for this stock : NA
  • Schaeffer rating for this stock : 7 / 10
  • Power Rating : 3 / 10
  • Insider Trading (last 52 weeks) : ($1.97M)
  • Option Trading: Jun 2007 45 Call
  • Implied Volatility (IV) for Mar 2007 $45 Strike : 33.12%

One of FRK’s competitor, Texas Industries, which revenues depend on 75% of its’ cement capacity are generally bullish by analysts. Demand for cement specially in Texas and California was strong. So even though the housing market is softening, the demands for cements are still there, particular California. But that’s California, you might argue.

Well, Florida Rock Industries, which distributes sand, gravel, concrete, and cement is another company that has been setting record sales and earnings lately. The stock is very cheap (trading at price earning ratio or P/E of only 15.2) and is also exposed to the construction market and the commercial market which are doing well. Because of substantial weakness in the Florida residential real-estate market, the Jacksonville-based company will instead look to non-residential and highway construction for growth opportunities in 2007.

In the meantime I’m still researching Netflix, Inc. (Nasdaq: NFLX, stock), Parexel International Corp. (Nasdaq: PRXL, stock) and QUALCOMM Inc. (Nasdaq: QCOM, stock).

# TIP: I think it’s worth investing in FRK – option trading with sufficient time-value, as usual.

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