MLI - The Transformation Continues For Mueller Industries

2024-05-30 09:36:35 ET

Summary

• Mueller Industries' margins have remained strong despite declining copper prices, indicating a fundamental change in their business model.
• The company has announced a significant acquisition, signaling a shift in their strategy towards horizontal acquisitions.
• The acquisition of Nehring Electrical Works Company could potentially boost Mueller Industries' EBITDA and EPS.

Introduction

It was just over one year ago that I wrote the following article about how I saw three things that were different with Mueller Industries' ( MLI ) fundamentals in this cycle. That is not a statement I made lightly. As a typically skeptical value investor, it's almost never 'different this time.' However, clearly something had changed since margins were higher than before and declining significantly less than previous down cycles in pricing for MLI's most important feedstock: copper. I do encourage the reader to review that article briefly if you're not aware of the changes in MLI's business profile....

For further details see: