Manitowoc Company Inc. (NYSE:MTW)’s fourth quarter earnings were below par. This lead the management of the company to split the company into two. Investors thought this was a good decision and stuck with the company. But the numbers suggest that Manitowoc Company Inc. (NYSE:MTW) has nothing to offer in the oncoming years to the investors. The construction business is as tricky as they come. Currency turbulence had a large part to play in the losses incurred, along with a low demand for off-road cranes. On top of all that, the drop in oil prices sealed the hope of getting a good quarter.
The fourth quarter earnings for Manitowoc Company Inc. (NYSE:MTW) dropped by 17 percent on year to year basis. That tells us that the company has been on a downward spiral for quite some time because the pace at which the company’s stock has been dropping is extraordinary. Even though during the fourth quarter the demand for crawler and tower crane grew, which wasn’t enough to save Manitowoc Company Inc. (NYSE:MTW) from a tide of losses. Investors haven’t bailed out yet but when they come to realize that splitting the company into two won’t do Manitowoc Company Inc. (NYSE:MTW) any good, they’ll certainly start shorting the stock.
Manitowoc Company Inc. (NYSE:MTW) was in a desperate position. It was hard to make money in the circumstances where there was no demand for products, low oil prices and high labor prices, along with other labor hassles. Now the company is relying upon the food service equipments. That region has been safe up till now but since the construction business isn’t doing too well, all the pressure will be exerted upon the food service area. The fragile construction business will now have to be dealt with the strength of the food service business. We are not sure if the food service business will be able to handle the back breaking pressure for too long.
In any case, Manitowoc Company Inc. (NYSE:MTW) should make sure that the investors don’t get a wind of the pressure it is under. Once they do, they’ll bail out overnight. The company should glorify its strengths, for the investors and their money shouldn’t stop flowing in. Manitowoc Company Inc (NYSE:MTW) needs the support of strong investors as if they start bailing out will be a huge blow to the company, one that it won’t be able to handle.
Manitowoc Company Inc. (NYSE:MTW) also needs to rebuild its construction business and make it sustainable. It has been a steady business which is adversely affected by unsavory circumstances. But it is expected that everything will fall into place in good time, so the Company shouldn’t give up on any of its businesses. For some time the food service business will have to bear extra burden but that will give Manitowoc Company Inc. (NYSE:MTW) enough time to rebuild its construction side, which will obviously take time, but will be worth the effort.
