Comments on: More On Commodities http://stockmarketbeat.com/blog1/2006/09/25/more-on-commodities/ Our beat: The stock market. Our job: Beat it. Sat, 11 Oct 2008 23:50:57 +0000 http://wordpress.org/?v=2.2.1 By: Stock Market Beat » Blog Archive » Amphenol on a Roll http://stockmarketbeat.com/blog1/2006/09/25/more-on-commodities/#comment-4378 Stock Market Beat » Blog Archive » Amphenol on a Roll Thu, 19 Oct 2006 16:31:52 +0000 http://stockmarketbeat.com/blog1/2006/09/25/more-on-commodities/#comment-4378 [...] On their conference call, management noted that profits had improved in their cable business: From a segment standpoint, in the cable segment margins increased to 12.4%, up 70 basis points from last year and 50 basis point sequentially from 2Q. Margins in this segment have been under a significant pressure as a result of increases in material and trade related costs driven by higher commodity and energy prices. The company has implemented multiple price increases in both 2005 and 2006 that have collectively begun to bring up margins in this segment. The company had been implementing price hikes along the way as copper and energy prices soared (both are crucial inputs for the cable segment.)  However, there is a lag between when the company sees rising costs and when they can be fully passed along to customers. Margins were hurting during that lag time. Given the recent decline in energy prices and stabilization of copper prices, the company’s price increases appear to be catching up with costs. However, it is worth noting that costs could quickly swing the other way again. Given our beliefs on the direction of future commodity prices, we view these margin gains as temporary. [...] […] On their conference call, management noted that profits had improved in their cable business: From a segment standpoint, in the cable segment margins increased to 12.4%, up 70 basis points from last year and 50 basis point sequentially from 2Q. Margins in this segment have been under a significant pressure as a result of increases in material and trade related costs driven by higher commodity and energy prices. The company has implemented multiple price increases in both 2005 and 2006 that have collectively begun to bring up margins in this segment. The company had been implementing price hikes along the way as copper and energy prices soared (both are crucial inputs for the cable segment.)  However, there is a lag between when the company sees rising costs and when they can be fully passed along to customers. Margins were hurting during that lag time. Given the recent decline in energy prices and stabilization of copper prices, the company’s price increases appear to be catching up with costs. However, it is worth noting that costs could quickly swing the other way again. Given our beliefs on the direction of future commodity prices, we view these margin gains as temporary. […]

]]> By: Jim http://stockmarketbeat.com/blog1/2006/09/25/more-on-commodities/#comment-3850 Jim Sun, 01 Oct 2006 18:22:37 +0000 http://stockmarketbeat.com/blog1/2006/09/25/more-on-commodities/#comment-3850 Yay! Someone else also read that article. Suffice to say, I do have a differing opinion about the recent commodity boom. http://www.diyeconomist.com/wp/economy/2006_09/error-maximization-and-what-do-commodities-return/ Yay! Someone else also read that article.

Suffice to say, I do have a differing opinion about the recent commodity boom. http://www.diyeconomist.com/wp/economy/2006_09/error-maximization-and-what-do-commodities-return/

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