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Abels Joyg

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Abels Joyg

  1. 1. Joy Global Inc..<br />Kevin Abels<br />NASDAQ: JOYG<br />
  2. 2. Presentation Outline<br /><ul><li>Company Description
  3. 3. Sources of Revenue
  4. 4. Porter’s 5 Forces
  5. 5. SWOT Analysis
  6. 6. Competitors
  7. 7. Key Drivers
  8. 8. Stats
  9. 9. Valuation
  10. 10. Conclusion</li></li></ul><li>Company Description<br /><ul><li>Joy Global manufactures mining equipment used to extract coal, copper, iron ore, and many other minerals and bedded materials.
  11. 11. Joy Global is comprised of three market-leading businesses
  12. 12. P&H Mining Equipment,
  13. 13. Joy Mining Machinery
  14. 14. Continental Crushing and Conveying. </li></li></ul><li>Company Description<br /><ul><li>Founded in the late 19th century
  15. 15. Headquartered in Milwaukee, Wisconsin
  16. 16. Employs more than 10,000 personnel worldwide</li></li></ul><li>Sources of Revenue<br />
  17. 17. Sources of Revenue<br />Annual Sales<br /><ul><li>Approximately 60% of revenues originate from aftermarket services
  18. 18. Stability to revenues/profits
  19. 19. Creates customer preference</li></li></ul><li>Porter’s Five Forces<br />
  20. 20. Degree of Rivalry - Medium<br /><ul><li>Several dominant players
  21. 21. Joy Global
  22. 22. Bucyrus
  23. 23. Terex
  24. 24. Differentiated by service/support
  25. 25. All are global players</li></li></ul><li>Potential of New Entrants-Low<br /><ul><li>Capital intensive industry
  26. 26. Big players dominate market
  27. 27. Not a fragmented industry</li></li></ul><li>Power of Suppliers-Low<br />Suppliers have minimal power over industry players<br />Commodity nature of supplies limits power<br />
  28. 28. Power of Customers-Medium<br /><ul><li>Relatively low, but considerable, switching cost
  29. 29. Little product/service differentiation</li></li></ul><li>Threat of Substitutes-Low<br /><ul><li>Very few substitution products</li></li></ul><li>
  30. 30. Strengths<br /><ul><li>Strong market position – Highly exposed to emerging markets (China Mining Machinery)
  31. 31. Financial stability
  32. 32. Strong backlogs that extend out for several years
  33. 33. A majority of revenues come from aftermarket parts and services – Tied to production levels and have been historically stable in economic turmoil</li></li></ul><li>Weaknesses<br /><ul><li>Majority of revenue is derived from the US market where industrialization is declining
  34. 34. Financial performance is heavily dependant upon commodity prices – specifically coal, copper, and iron ore</li></li></ul><li>Opportunities<br /><ul><li>China
  35. 35. Other emerging markets</li></li></ul><li>Threats<br /><ul><li>Possible trend of moving toward natural gas to provide energy solutions
  36. 36. Eventual economic slowdown in China
  37. 37. New competitors will arise in the emerging markets
  38. 38. Alternative energy</li></li></ul><li>Competitors<br />*Most Recent Quarter<br />
  39. 39. Key Drivers<br />
  40. 40. Key Drivers<br /><ul><li>China/Emerging Markets – Early on a Long Journey
  41. 41. Currently in restocking phase
  42. 42. China positioned to lead the global economic recovery</li></li></ul><li>Key Drivers<br />Coal Consumption by Country Grouping<br />
  43. 43. Stats<br /><ul><li>Market Cap: $4.86B
  44. 44. P/E: 10.98
  45. 45. ROA: 17.67
  46. 46. ROE: 62.37</li></li></ul><li>Valuation<br />
  47. 47. Valuation<br /><ul><li>Price – $47.45
  48. 48. Yr Range - $14.33 – $56.07</li></li></ul><li>Valuation Assumptions<br />
  49. 49. Conclusion<br />

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