Over the last five years, Quanex Building Products Corp. (NYSE:NX) has improved its profitability and cash flows. However, the company has more scope for improvement in its operations and profit margins. The company has shown that it's willing to act to reduce costs by closing under-utilized facilities and more may be needed in that direction. The company's shares are fully priced at current levels.
Manufacturing Overcapacity
2018 Quanex's manufacturing facilities operated at 59% of capacity. In comparison, Masonite International Corp. had an average production capacity utilization of 77%. There's room for greater utilization