Kiplinger: II-VI stock worthy of attention
Butler County-based II-VI Incorporated, a global producer and supplier of lasers and engineered materials used in consumer and military products, recently was listed among 10 companies worthy of attention from investors.
Kiplinger Personal Finance published an article that included II-VI on a list of 10 companies whose stocks are predicted to be valuable for years to come.
The headquarters is listed in Saxonburg, Clinton Township.
“It's a good company in a small town,” said financial adviser Howie Pentony of Pentony Capital Management in Portersville. “It's a company with very sophisticated products. The people at Kiplinger think the company has a bright future.”
He said he has known about II-VI for 25 years, but admits to having only rudimentary understanding about products the company makes for the automotive and telecommunications industries. “They're so sophisticated; it's a very complex company to understand,” Pentony said.
Financial adviser Wendy Bennett, of Bennett Associates Wealth Management in Butler, said many Butler County residents invest in II-VI. They're a hometown favorite because of their local headquarters, Bennett said. “Clients like it because they're familiar with it, and they know someone who works there.”
Although Kiplinger said II-VI was positioned to produce robust returns, the company doesn't pay dividends, she said. Investors buy II-VI stocks and hold on to them anticipating a future increase in the stocks' value, Bennett said.
She said one of her clients has held II-VI stock for 18 years and the value has grown by 673 percent.
Kiplinger based its assessment of the stock on the company's $3.2 billion purchase of Finisar, a California-based producer of optical communications components and subsystems for telecommunications and automotive companies. The sale closed in September.
With that and previous acquisitions, II-VI now has 24,000 employees in 69 locations in 18 countries.
Mark Lourie, vice president of communications, said the Kiplinger article was positive, but declined to comment on it.
He discussed the products the company manufacturers for clients in its three core markets — industrial lasers for material processing, optical communications, and aerospace and defense. “We think of ourselves as experts in engineered materials,” Lourie said.
Engineered materials possess one or several properties — including optical, electrical, thermal or mechanical — that are used to make a variety of products, he said.
II-VI's name came from the company's ability to chemically combine zinc, zinc selenide, zinc sulfide and other compounds from group II and group VI of the periodic table of elements to make industrial lasers for material processing such as cutting, welding and drilling. For the industrial laser market, the company manufactures engineered materials, optics, semiconductor lasers and laser processing heads used in auto and consumer electronics factories, Lourie said.
Optical communications products such as semiconductor lasers are used in components in fiber-optic communications equipment that power the internet globally, he said. Aerospace and defense products are mostly used in military applications, he said.
