Abels Joyg

Kevin AbelsNASDAQ: JOYG

Joy Global Inc..

• Company Description• Sources of Revenue• Porter’s 5 Forces• SWOT Analysis• Competitors• Key Drivers• Stats• Valuation• Conclusion

Presentation Outline

•Joy Global manufactures mining equipment used to extract coal, copper, iron ore, and many other minerals and bedded materials. •Joy Global is comprised of three market-leading businesses

• P&H Mining Equipment, •Joy Mining Machinery•Continental Crushing and Conveying.

Company Description

Company Description

• Founded in the late 19th century

• Headquartered in Milwaukee, Wisconsin

• Employs more than 10,000 personnel worldwide

Sources of Revenue

Sources of Revenue

Annual Sales

• Approximately 60% of revenues originate from aftermarket services

• Stability to revenues/profits

• Creates customer preference

Porter’s Five Forces

• Several dominant players• Joy Global• Bucyrus• Terex

• Differentiated by service/support

• All are global players

Degree of Rivalry - Medium

• Capital intensive industry

• Big players dominate market

• Not a fragmented industry

Potential of New Entrants-Low

Suppliers have minimal power over industry players

Commodity nature of supplies limits power

Power of Suppliers-Low

Power of Customers-Medium

• Relatively low, but considerable, switching cost

• Little product/service differentiation

Threat of Substitutes-Low

• Very few substitution products

• Strong market position – Highly exposed to emerging markets (China Mining Machinery)

• Financial stability

• Strong backlogs that extend out for several years

• A majority of revenues come from aftermarket parts and services – Tied to production levels and have been historically stable in economic turmoil

Strengths

• Majority of revenue is derived from the US market where industrialization is declining

• Financial performance is heavily dependant upon commodity prices – specifically coal, copper, and iron ore

Weaknesses

• China

• Other emerging markets

Opportunities

• Possible trend of moving toward natural gas to provide energy solutions

• Eventual economic slowdown in China

• New competitors will arise in the emerging markets

• Alternative energy

Threats

Company PE ttm EPS ttm Net Margin Debt/Asset

Joy Global Inc 10.98 4.32 13% 19.32

Bucyrus 10.04 3.57 11.36% 22.44

Terex - -5.07 -5.89% 32.30

Competitors

*Most Recent Quarter

Key Drivers

Key Drivers

• China/Emerging Markets – Early on a Long Journey

• Currently in restocking phase

• China positioned to lead the global economic recovery

Key DriversCoal Consumption by Country Grouping

• Market Cap: $4.86B

• P/E: 10.98

• ROA: 17.67

• ROE: 62.37

Stats

Valuation

Valuation

• Price – $47.45• Yr Range - $14.33 – $56.07

Valuation Assumptions

Conclusion