Looking Forward to Ladish Report

Ladish Company (LDSH) will announce its earnings for the first quarter of 2008 on Monday, April 28, 2008 at the close of the market. A conference call to discuss those results and answer related questions will be held on Tuesday, April 29, 2008 at 9:00 a.m. EDT. Average revenue estimates for the first quarter of 2008 are $114.34 million and EPS of $0.57. For full year 2008 average revenue estimates are $487.87 million and EPS of $2.66.

Similarly, for 2009 average revenue estimates are $569.51 million and EPS of $3.27. LDSH is strategically diversified, with 60% of sales accounted for by deliveries to the manufacturers of jet engines, 20% of sales going to other aerospace applications, with the balance of 20% used by the general industrial sector. The companyâ?s business is split in two segments -- about 75 per cent commercial and 25 per cent defense, which is a quite desirable mix, given the current political climate.

Revenues are almost evenly divided between domestic sales within the U.S. and exports. The commercial aircraft cycle - and hence commercial jet engine production - is on the verge of entering a period of what appears to be a dramatic growth. The company has recently completed the repair of a critical piece of equipment, and will shortly have another new piece of machinery on-line which, together, will improve its production capability.

Not to be overlooked is the fact that Ladish is one of the two companies that make up the aerospace-forging oligopoly in the U.S. At this time we will rate the shares as BUY. 

With Metabolix, Stay on Sidelines

Metabolix Inc. (MBLX) is a biotechnology company focused on the development and commercialization of environmentally sustainable, economically attractive alternatives to petrochemical-based plastics, fuels and chemicals. While we are excited about the prospects of Mirel (Metabolixâ?s first product), we expect a delay in the companyâ?s commercialization plans as construction work at the Clinton facility was impacted by a harsh Midwest winter. The construction timing is currently being re-evaluated and we believe that product availability from the Clinton plant is likely to be pushed out to the first quarter of 2009.

Meanwhile, FDA approval for the use of Mirel in food contact applications is yet to come. Food contact applications account for a major part of the companyâ?s estimated demand (about 64%) for biodegradable plastics in 2010. Metabolix is currently conducting studies and is working on obtaining approval from the FDA.

Though Metabolix is working on other projects, including a second technology platform which is being developed for the co-production of Natural Plastic and biomass feedstock, these programs are still in early stages of development. As such, investor focus is likely to remain on Mirel-related issues in the coming quarters.

The stock has gone down significantly over the past few months - we recommend waiting on the sidelines until we gain more visibility on the ongoing issues related to the Clinton facility and FDA approval for food contact applications. It is difficult to value MBLX shares, given its little revenue and negative EPS. Based on our long-term earnings model, we do not see MBLX posting positive EPS over the next several years.

We rate the shares a Hold with a price target of $12. The stock is currently trading at $11.30 a suitable strategic partnership for the switchgrass program and approval of Mirel for food contact applications could provide upside to the name.