-
Hammond Power Solutions Inc. Class A Subordinate Voting Shares (HPS.A)
-
Hammond Manufacturing Company Limited Class A Subordinate Voting Shares (HMM.A)
Q: The Hammond Companies based in Guelph are producing astounding numbers yet HMM.A is far behind in stock market valuation with a projected P/E of 3 to 4. Why is there a discrepancy between the two companies.
5i Research Answer:
HPS.a or Hammond Power Solutions is a spin-off of Hammond Manufacturing Company or HMM.a whose primary products include electrical and electronic enclosures, racks and cabinets, power bars, and electronic (low-voltage) transformers. HPS was HMM's transformer division. Both companies are now fully independent. Since the spin-off, HPS has seen exponential growth and is nearly 9 times the size of HMM in terms of market cap. Growth prospects for HPS are also much more visible than for HMM. But HMM has been no slouch, up 79% YTD.