Grid growth

Headquartered in Zurich, ABB sells large-scale electrical circuitry, robotics and energy-monitoring and automation systems. It seems to land one multimillion-dollar infrastructure contract after another, including a recent $63 million deal to upgrade a power station in Saudi Arabia. Renewable-energy projects will need ABB's products and services, and its technology, including power-management sensors and load-balancing systems, has kept it ahead of most competitors, says Morningstar analyst Daniel Holland. ABB's shares have been cut by almost two-thirds, to 12, from their high last May, and now trade for nine times 2009 estimated earnings of $1.32 a share, a discount to the S&P 500's price/earnings multiple. Granted, last year's earnings were higher, at $1.74 a share, slightly exceeding expectations. Morningstar puts the company's fair value at 19 a share, some 62% above last week's close. Investors can collect a 46-cent annual dividend (for a current yield of 3.8%) while waiting for the global economy to jump-start. ABB recently shed some poorly performing assets in an efficiency drive of its own. The company boasts a strong balance sheet, and net cash (cash minus debt) of $5.4 billion, or $2.40 a share, Holland notes. It has used excess cash to boost its payout and buy in shares. Twelve-month return on equity of 28.39% is more than three times that of its peer group, which includes industrial outfits such as Emerson Electric (EMR) and Danaher (DHR).

someday we will go nucular again

“Mad Money’s” Pete Najarian liked ABB Ltd as an infrastructure play last week. Despite Najarian’s blessings, Fitzpatrick recommended against taking a position in this stock right now. With a recent breakout below the 50-day moving average (the stock’s average price over the last 50 days), the downside potential is just too great. He recommended waiting for an up day before going long ABB.

Jordan's portfolio normally includes no more than 25 to 40 names, which means that even the smallest positions can have a big impact on performance. About 35% of the fund's assets go into the top 10 holdings, which currently include oilfield-service specialist Schlumberger (SLB), Internet services provider Google (GOOG), drilling contractor Diamond Offshore (DO), power-systems supplier ABB (ABB), coal producer Peabody Energy (BTU) and entertainment behemoth Walt Disney (DIS).

Swiss nuclear plant builder. Low P/E.

From a recent Mad Money show:"Don't pull the trigger. This is one engineering company I don't like. They're a house of pain."

4.2%

This industry is starting to differentiate itself from the minerals extraction business where the orders are being cancelled, as we know from ABB (ABB) this morning.

Mad About Options: Emerson's Faulty Plug:
The Mad About Options crew takes a look back at Jim Cramer's comments about Emerson Electric Co.

Click here to watch the video.

Growth potential
seemed undervalued
out of U.S. market