Chart Industries, Inc. (GTLS), Carpenter Technology Corporation (CRS), Allegheny Technologies Incorporated (ATI): Specialty Metal Producers For Your Portfolio

Carpenter Technology Corporation (NYSE:CRS)’s trailing twelve month revenue figure are its highest in a 5-year period with its EBITDA figures also showing an uptrend in recent years.

Allegheny’s new plants

Allegheny Technologies Incorporated (NYSE:ATI) is another globally-oriented manufacturer of specialty metals. It operates through its high performance metals segment, flat-rolled products segment and engineered products segment. Allegheny Technologies Incorporated (NYSE:ATI)’s major revenue comes from companies in the aerospace & defense, oil & gas/chemical, electrical energy and medical industries.

Allegheny Technologies Incorporated (NYSE:ATI) has been restructuring its business recently. As the flat-roll steel model is about to expire, the company is moving to higher margin alloy products. The company’s acquisition and investments have reduced its exposure to the cyclicality of the industry and foreign markets.

In its recent company presentation, Allegheny Technologies Incorporated (NYSE:ATI) has stated that its projected capital expenditure for the year 2013 would be close to $550 million. Most of that capital would be spent on the company’s new hot-rolling and processing facility which will be the world’s most powerful and technologically advanced specialty metal plant of its kind. This plant will be ready for service by the end of the ear 2013 and it will be capable of rolling next generation carbon steels.

The demand for the company’s specialty alloys is also set to increase, as new aircraft require stronger and lighter metals for the development of their engines.

The company’s net income and EBITDA figures have been decreasing since 2011, but with its new focus, I expect the company will start showing some impressive results in the future.

The takeaway

The metal fabrication companies present interesting cases as they have evolved to focus on niche markets where they are able to generate high margins. All three companies mentioned above have robust business models, but I expect Chart Industries, Inc. (NASDAQ:GTLS) to show the best growth in the coming years.

The article Specialty Metal Producers For Your Portfolio originally appeared on Fool.com and is written by Awais Iqbal.

Awais Iqbal has no position in any stocks mentioned. The Motley Fool recommends Chart Industries. Awais is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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