C.R. Bard, Inc. (BCR) is generating solid returns on equity and consistent free cash flow, in addition to being awarded several hundred million dollars from a patent infringement lawsuit against W.L. Gore & Associates, Inc., making BCR a valuable investment, says Mark W. Oelschlager, Portfolio Manager at Oak Associates, Ltd.
“One of our big holdings is CR Bard (BCR)…we’re talking about a company that generates returns on equity well into the 20s; consistent free cash flow; it’s trading at about a 7% free cash flow yield, whether you take the most recent year’s results or the last four years; and it is one of the leaders in its field,” Oelschlager said.
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BCR is an uncommon value, as it is a dominant company with strong financial metrics that is trading at a cheap valuation, and the stock is also not reflecting the company’s recent award from a patent infringement lawsuit, Oelschlager says.
“A kicker to the story there is that they recently won a lawsuit against Gore for patent infringement, and they are being awarded several hundred million dollars. Gore is appealing, but that’s a big chunk of change that should be coming Bard’s way, and it really doesn’t seem to be reflected in the stock at all,” Oelschlager said.