ComparisonCould you compare and contrast PSI, TVK and NOA, with risk and total return over the next three years being the primary concerns.
Among the three names mentioned, we like TVK and NOA. The common theme among the three names is they are cyclical businesses, which expect to do well in a good economy and not do as well in a recession. PSI is a much more cyclical business than the other two (TVK is less cyclical, and NOA is currently in an up cycle), which we would not be comfortable owning for the long term.
In terms of total return, we think TVK and NOA could do well from these levels over the next three to five years given their cheap valuation. (5iResearch)