Wednesday, February 27, 2008

CECO Environmental Makes It's Entrance Into China

CECO Environmental Corp ticker symbol (CECE) has announced that it will buy Fisher-Klosterman, Inc. for 15 million cash and 1 million in CECE stock. This strategic acquisition will not only help improve CECO Environmental's revenues and net income, but will also provide a key 40,000 square foot sales and manufacturing facility in Shanghai, China. This should help CECO display it's already massive product line to those in red hot China.

"We are excited about joining CECO and advancing our shared strategic vision for the company. CECO offers the Fisher-Klosterman companies improved access to capital, a seasoned team of successful senior management, larger- scale marketing resources, internal supply of many related products and services, and expansive relationships with new potential customers," said William Heumann, president of Fisher-Klosterman, Inc.

The acquisition of Fisher-Klosterman is yet another step in the right direction for CECO Environmental. The potential for environmental pollution control in China will become huge. With the world's eyes on China for the upcoming Olympics, China will be forced to clean up it's act. People are already starting to say that the athletes will not be able to perform in such smoggy conditions. China has pasted The United States in terms of Greenhouse Gases as well, so it is only a matter of time before the world starts to put the pressure on them to become more energy efficient and reduce their air pollution. Of course, if you are familiar with CECO's business you know that they can really benefit from these upcoming environmental standards not only in China, but all over the world.

China is a growing industrial hot spot, and the demand for an established air pollution control company like CECO could be huge. Needless to say we here at Stock Picky have been behind CECO for a little while now, and the stock has taken a hit since it was first highlighted it at $13.37. As long as you spread out your buys over time you should be just fine, as is the case with all long term stock picks. Remember, this company is tiny at only a 138 million dollar market cap, so fluctuation like this are not abnormal. Also, take into account that they are reporting earnings on March 10th, 2008 and this could send the stock in either direction over the short term.

For more reasons to own CECO check out my first post here...

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