Monday, February 19, 2001

Companies That Do It All

A powerful movement in the U.S. over the past several decades is the de-integration of manufacturing: Witness, for example, the rise of such horizontal companies as Intel, Microsoft, Dell and Oracle in a field that was once dominated by the vertically integrated IBM. But for every trend there is a countertrend from which investors can make money. On this page we focus on companies that are conspicuous for their degree of vertical integration.

Furniture Brands International manufactures furniture in 20 plants and retails the goods in some 100 franchise-owned stores in the U.S. (under the Thomasville brand). It's a smart strategy, says Margaret Whelan, an analyst at UBS Warburg, not adequately recognized in the multiple (11 times estimated 2001 profits) at which Furniture Brands trades.

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