Shifting some capital into the industrial sector, specifically looking for small-cap companies that are trading below intrinsic value. Criteria include solid balance sheets, consistent FCF generation, and a clear path to growth or margin expansion. Any specific names that have come up in your screening?
Are you only looking domestically, or are you open to international small-cap industrials? There might be some interesting opportunities overseas.
Consider the CapEx requirements for some of these industrials. High CapEx can eat into that FCF pretty quickly, even with a solid balance sheet.
Good criteria. I'd add management quality to that list; it's even more critical in smaller companies for navigating growth.
I haven't found anything screamingly cheap in industrials lately, everything seems priced for perfection. Are you seeing specific sub-sectors that look promising?
I've been looking at similar plays. Keep an eye on companies in the specialized manufacturing niche; they often get overlooked but have strong competitive moats.
Small-cap industrials are tricky right now with interest rates. Make sure you're factoring in debt servicing costs if you're looking for consistent FCF.
Solid strategy. I don't have a specific name, but I'd screen for those with high insider ownership; alignment of interests can be a big plus.