Chart of the Day
- Chinese rebar futures markets not betting on stimulus working in construction
- Rebar spot prices down about 20% Y-o-Y nominal
- Worth watching to gauge informed local market expectations for construction activity/heavy equipment demand
Navistar Miss: Navistar reported some very challenging results and the shares have sold off significantly today. The lack of clarification on the company’s engine certification was particularly troubling. Even after a period of significant underperformance relative to Paccar, Paccar still trades at a 23% discount to Navistar on an Adjusted EV/2011 EBITDA basis. While this may reflect some concerns about Paccar’s SEC inquiry, that is a less significant business headwind than not meeting *2010* emissions targets in mid-2012.