Sun Hydraulics (SNHY) 2012 Review

Sun Hydraulics, SNHY,  designs, manufactures and markets valves and manifolds for hydraulic systems including electrical and nonelectrical actuated valves, machined manifolds and custom valve and manifold assemblies for use in construction agriculture, mining, industrial and fire and rescue equipment. 

The company has grown dividends and profits at a 10-18% pace over the past five years earning a 15-20% return on equity. SHNY’s business suffered dramatically in the 2009 recession; however, it has made a strong comeback which should continue as a result of:

(1) growth in global industrial capital expenditures,

(2) price increases,

(3) exposure to Germany, Korea, China and India.

McDonald's (MCD) 2012 Review

McDonald’s operates or licenses more than 33,500 fast food restaurants world wide. 

Over the past ten years, the company has grown profits at a 13% pace but dividends at 26% annualized while earning a 25%+ return on equity. Looking forward, the pace of advance of dividends should slow somewhat although earnings growth is expected to continue at an above average pace as a result of:

(1) global growth not only in the number of restaurants but also in same store sales,

(2) introduction of new higher margin products [McCafe Real Fruit Smoothies, Frappes, Angus snack wraps],

(3) a revitalization program aimed at increasing market share via rising restaurant visits, growing brand loyalty and a new marketing campaign,

Accenture (ACN) 2012 Review

Accenture Ltd  (ACN) is a global leader in management and technology consulting services and outsourcing solutions with 200 offices in 54 countries. 

The company has generated an impressive 50%+ return on equity over the last five years while growing earnings per share and dividends 13-15% annually. ACN should be able to continue this trend as a result:

(1) demand for consulting and outsourcing services are rising sharply in all its business segments,

(2) global economic improvement will contribute to revenue growth,

(3) Accenture’s strong financial condition will allow it to continue its aggressive stock buy back program.