Wednesday, September 30, 2009

Versar involved in $3 billion Air Force contract

Versar among 16 companies receiving $3 billion contract for environmental work; shares soar

Government contractor Versar Inc. said Wednesday it is one of 16 small businesses that received a $3 billion five year Air Force contract for environmental and other work.

The contract by the Air Force's center for engineering and the environment, which includes an eight-year performance period, calls for environmental restoration services, construction and services in support of the Military Munitions Response Program.

*11 Small Cap Stocks Trading Near Book Value

Tuesday, September 29, 2009

Two Under Valued Companies Trading at Their Cash Value

Without getting into the current Healthcare Reform issues. Here are two managed-care companies Humana Inc. and Molina Healthcare that are now selling for what they currently have in cash. Humana has nearly doubled off its march low while Molina is only up about 30 percent. Both have current ratio's above the 1.5 ratio, which is a measure of a company's ability to pay back short- term debt with its short term assets. A ratio of under 1 shows that they might be hard pressed to pay off any monies owed if it were due at that point. Molina is currently trading at 1x book value while Humana has a book value ratio of 1.28. Molina has increased its book value almost 5.5x since 2002
while Humana has increased theirs 3x which is a key measure that Warren Buffett looks for.Both seem to be consistent free cash flow generators another key measure that most value investors look for. Income investors might want to look elsewhere due to the fact that neither company pays a dividend.

CompanySymbolCash/sharePrice as of 9/28/2009Book value/shareCurrent ratio
P/E ratioMarket cap
HumanaHUM$36.57$38.03 $29.821.627.56.3b
Molina HealthcareMOH$21.59$20.97$20.941.889.4537m

*The Molina family along with other insiders hold 51% of the stock. Currently 20% of the float is being shorted.

*Value Investor Bruce Berkowitz of The Fairholme Fund ($FAIRX) owns 9.5 million shares of Humana which represents a top ten holding for the fund.

Tuesday, September 22, 2009

Spot Light On A Small Cap Stock

Vicon Industries $VII Industries is an industry-leading designer, manufacturer and marketer of video systems and components used for security, surveillance, safety and control purposes. Celebrating over 40 years in business, the company is unrivalled in experience developing video surveillance technologies. Vicon systems are employed worldwide in high-profile, enterprise-scale installations by a diverse range of customers, including governments, Fortune 500 companies, private and public institutions, and global transit and commerce hubs.

Vicon currently trades at 4x current free cash flow with a Book Value of 7.6. Currently the stock is trading at $5.85 per share. Management has a 39% stake in the business. It also has a earnings yield of 11.24% which is double the S&P 500’s earnings yield of 5.29%. Recently the company was named to Fortune Magazine’s 2009 Fastest Growing Small Public Companies.

Posted via email from stockmanmarc's posterous

11 Small Cap Stocks Trading Near Book Value

Benjamin Graham considered the father of security analysis and value investing used a set of tools to pick stocks. These tools much like a carpenter uses to build or fix a house, Graham used to find undervalued stocks. His tools were low P/E ratios, stocks that traded near book value, stocks that made money over the past 5 years, and stocks that showed consistency of paying a dividend. Here is a list of 11 small cap companies trading near their book value. Most of these companies have several characteristics that a Value Investor such as Graham would be looking for. All trade at a low P/E ratio with earnings growth over the last five years. All but one pay a dividend. Six of these issues have paid out a dividend for 10 straight years.

American Physicians Capital- founded in 1975 through its subsidiaries, is a regional provider of medical professional liability insurance focused primarily in the Midwest, with Michigan, Illinois, Ohio, Kentucky, and New Mexico as our core states. Based on direct written premiums as reported by A.M. Best Company, we are among the top writers of professional liability in Michigan, New Mexico and Illinois. We rank 19th nationally among professional liability insurers, with approximately 9,300 policies in-force.

Apogee Enterprises- founded in 1949 and is based in Minneapolis, Minnesota transforms plain glass to create distinctive solutions for architects, building owners, contractors, picture framers and others. Our glass and aluminum window, storefront and curtainwall systems make commercial buildings look great, reduce energy consumption and protect against hurricanes and blasts. Apogee's glass also reduces fading and reflection for picture framing customers.

Chase Corporation- founded in 1946 and is headquartered in Bridgewater, Massachusetts engages in the manufacture of specialty tapes, laminates, sealants, and coatings, as well as in the provision of contract assembly services for the electronics industry worldwide.

Espey Mfg. & Electronics Corp.- founded in 1928 and is based in Saratoga Springs, New York engages in the development, design, production, and sale of electronic power supplies, various transformers and iron-core components, and electronic system components primarily in the United States.

Friedman Industries- founded in 1965 and is based in Houston, Texas. Together with its subsidiaries, engages in steel processing, pipe manufacturing and processing, and steel and pipe distribution in the United States.

Oil Dri Corp. of America - founded in 1941 is a leading developer, manufacturer and marketer of products for consumer, industrial and automotive, agricultural, sports fields and fluids purification markets. Oil-Dri -- Creating Value From Sorbent Minerals

Preformed Line Products Company- founded in 1947 and is headquartered in Mayfield Village, Ohio. Together with its subsidiaries, designs and manufactures products and systems employed in the construction and maintenance of overhead and underground networks for the energy, telecommunication, cable operators, and information industries worldwide.

Patterson-UTI Energy- founded in 1978 provides onshore contract drilling services to exploration and production companies in North America. The Company has approximately 350 marketable land-based drilling rigs that operate primarily in oil and natural gas producing regions of Texas, New Mexico, Oklahoma, Arkansas, Louisiana, Mississippi, Alabama, Colorado, Arizona, Utah, Wyoming, Montana, North Dakota, South Dakota, Pennsylvania, West Virginia and western Canada. Patterson-UTI Energy, Inc. is also engaged in the businesses of pressure pumping services and drilling and completion fluid services.

Servotronics- founded in 1959 engages in the design, development, and manufacture of high quality components, systems and sub-systems for use wherever precise control, reliability and cost containment are primary requirements.

The Stephan Co.- founded in 1897 and is headquartered in Fort Lauderdale, Florida together with its subsidiaries, engages in the manufacture, sale, and distribution of hair care and personal care products.

Versar- founded in 1969 and based in Springfield, Virginia provides various professional services to the government and private sector with solutions for infrastructure, facilities management, construction, environmental quality, defense, and homeland security needs in the United States and internationally.

TickerPrice as of
Book ValuePrice Book RatioFree Cash FlowP/ECurrent RatioMkt CapTotal DebtEarnings Growth Past 5 yrsYield %Industry
ACAP 29.5422.371.37 40.9m8.544.92313.4m25.9m24.31.1Property & Casualty
APOG 15.9411.511.35 31.2m8.941.63444.8m8.4m31.42.2General Building Material
CCF11.67.861.46 12m13.573.0499.1m07.83.1Industrial Equipment & Components
ESP18.113.441.37 4.7m14.2313.338.2m0535.1Diversified Electronics
FRD6.158,2.753.8m4.389.4841.8m54,03016.270.6Steel & Iron
ODC14.3112.931.14 5m11.232.92101.1m21.5m12.714Specialty Chemicals
PLPC 39.5028.191.40 5m13.483.07206.8m7.8m11.42Heavy Construction
PTEN 15.0413.811.11 168.6m12.452.052.3b011.81.3Oil & Gas Drilling & Exploration
SVT7.209.63.782m6.324.9213.9m4.1m38.152Industrial Electrical Equipment
TSC2.425.51.462.1m13.976.6110.3m426,00022.133.3Personal Products
VSR4. Services

Thursday, September 17, 2009

Update on Steak n Shake!

Sardar Biglari, CEO of Steak n Shake continues to whittle down the debt while increasing free cash flows. The stock has made a nice move over the last couple weeks. Biglari has added to his stake by purchasing an additional $4,000,000 dollars worth. Traders may want to give this Value play a look, it is trading near its 12 month high.

Links to recent articles: Biglari & Co. Find Value In Those Famous Steakburgers, Biglari: The Young Buffett, Market Report- In Play SNS

Tuesday, September 15, 2009

10 Small Caps with High "Insider Ownership"

All 10 stocks mentioned below offer double digit rates of return on equity as well as assets. ROE is a corporations measurement of how profitable the company is with the money shareholders have invested. ROA shows how efficient management is at using its assets to generate earnings. All ten are trading at reasonable P/E ratios. All 10 mentioned have current ratios above 1.9, any thing above 1.5 shows that the company is capable at paying back short term debt. All 10 have a large inside ownership with modest to low debt and free cash flow, with each paying a dividend.

CompanySymbolPrice$ as of 9/14/09P/E
ROE%ROA%Market CapFree
Cash Flow
AAON, Inc.AAON20.3112.529%18%349 mil20 mil27%2.1
Advance AmericaAEA5.679.620%11%358 mil168 mil31%5.2
Alliance HoldingsAHGP20.1611.938%11%1.2 bil122 mil79%2.1
Alliance ResourceARLP3511.352%11%1.3 bil71 mil44%2.1
BuckleBKE28.5411.530%23%1.3 bil94 mil44%3.7
BreitBurn Energy BBEP10.95.9265%21%593 mil37 mil42%1.95
Cal-Maine FoodsCALM28.398.526%14%659 mil113 mil39%2.3
Lancaster ColonyLANC50.5615.923%16%1.4 bil64 mil35%2.9
NEU88.6514.227%12%1.3 bil42 mil23%2.8
Terra NitTNH10610128%63%1.9 bil375 mil75%5

* Deep Value Investor Seth Klarman of The Baupost Group holds 8.49 million shares of BreitBurn Energy which accounts for over 16% of the stock.

Thursday, September 10, 2009

A Look at The Big 3: Medical Stocks

Pharmaceutical distribution in the United States is dominated by three firms: Cardinal Health CAH, McKesson MCK, and AmerisourceBergen ABC. AmerisourceBergen is the purest play on this narrow-moat industry. However when siphoning through the numbers one sees their is a big contrast in their stock valuations. Without getting into the Presidents medical proposals, one needs to focus on the value of the individual businesses themselves. All three are trading at reasonable valuations, but digging into the numbers a little deeper, Cardinal Health is clearly the cheaper stock. Cardinal is trading near its book value, while the other two are over 2x book value. Cardinal also offers a much more attractive dividend yield. Cardinal's P/E ratio is currently half the industry average. While all three hold a bright outlook going forward Cardinal seems to have a margin of safety already built into its share price. This is not to say that its stock price could not fall from current levels but that it is trading at a cheaper valuation than the other two companies. With the aging of the population in the United States their is still much upside in this industry and Cardinal offers you a dividend while you wait.

AmerisourceBergen Corporation,
a pharmaceutical services company, offers drug distribution and related services to health care providers and pharmaceutical manufacturers in the United States, the United Kingdom, and Canada. It distributes brand name and generic pharmaceuticals, over-the-counter health care products, home health care supplies and equipment, and related services to health care providers, such as acute care hospitals and health systems, independent and chain retail pharmacies, mail order facilities, physicians, medical clinics, and long-term care and other alternate site pharmacies.

Cardinal Health, Inc. provides health care products and services primarily in the United States. The company’s Health care Supply Chain Services segment distributes branded, private-label medical and laboratory, generic pharmaceutical, health care, and consumer products to retail customers, hospitals, and alternate care providers. It provides distribution, inventory management, data/reporting, new product launch support and contract, and charge back administration services, as well as operates a pharmaceutical repackaging and distribution program that offers repackaged pharmaceutical products.

McKesson Corporation, together with its subsidiaries, provides supply, information, and care management products and services for the health care industry. It operates through two segments, Distribution Solutions and Technology Solutions. The Distribution Solutions segment distributes ethical and proprietary drugs, medical-surgical supplies and equipment, and health and beauty care products in North America. This segment also provides specialty pharmaceutical solutions for biotech and pharmaceutical manufacturers; sells pharmacy software; and provides consulting and outsourcing services. The Technology Solutions segment provides enterprise-wide clinical, patient care, financial, supply chain, and strategic management software solutions; pharmacy automation for hospitals; and connectivity and outsourcing services.

Company NameSymbolPrice

P/B RatioRevenue
(end June 30th)
Mkt Cap

P/E Ratio (TTM)Dividend YieldDebt/Equity
Cardinal HealthCAH26.831.199.5b9.36b8.52.70%.38

Wednesday, September 9, 2009

4 Stocks With Rising Dividend$

Below is a screen I ran this morning on dividend stocks. This screen seeks to identify quality companies that have a history of good dividend growth and that also have an additional kicker: their shares are sporting above-average yields. All four are ranked A or better by Standard & Poor's Investor service. All four have grown their dividends at double digits over the last 5 years.

The Strategy for owning/investing in dividend stocks

Cash dividends are tangible. They can't be fabricated, or falsified, or manipulated. Over time, dividends are a true record of a company's performance. They can also represent a significant proportion of an investment's total return. Since 1926, dividends have accounted for almost 42% of the total return (capital appreciation plus reinvested dividends) of the S&P 500. The attraction of a safe, secure dividend, moreover, will help to support and cushion a stock when the market is going through bad times and is under downward pressure.

Company NameTicker SymbolS&P Rank (earnings/div. rank)Dividend YieldDividend Growth Rate(5 yr avg)Trailing P/ECurrent Ratio
VF CorpVFCA3.4%17.81%14.92.3
Johnson & JohnsonJNJA+3.24%11.45%13.41.8
Sysco CorpSYY
Emerson Elec CoEMRA3.47%10.53%15.61.5

Thursday, September 3, 2009

Your Garbage Can Pay You Dividends

First Posted On Our Sister Site @ HighYieldingDividends

garbage1Who said their wasn’t money in trash. Well these three companies pass their profits to share holders. Listed below are three companies that are in the waste management industry. Two large caps and one small cap. All three pay a nice dividend. One well known tycoon has a significant stake in Republic Services.

Waste Management, Inc. - was founded in 1894 and is based in Houston, Texas. Waste Management (WM) is the leading provider of comprehensive waste management and environmental services in North America. As of December 31, 2008, the company served nearly 20 million municipal, commercial, industrial and residential customers through a network of 367 collection operations, 355 transfer stations, 273 active landfill disposal sites, 16 waste-to-energy plants, 104 recycling plants, and 111 beneficial-use landfill gas projects.

Republic Services, Inc. - was founded in 1996 and is headquartered in Phoenix, Arizona. Republic Services (RSG) is a leading provider of solid waste collection, transfer, recycling and disposal services. We operate 400 collection companies in 40 states and Puerto Rico and provide top quality services to commercial, industrial, municipal and residential customers. Republic serves millions of residential customers under contracts with more than 3,000 municipalities for waste collection and residential services.

American Ecology Corporation - was founded in 1952 and is headquartered in Boise, Idaho. American Ecology (ECOL) is one of the nation’s oldest providers of radioactive and hazardous waste services. The company accepts hazardous and low-level radioactive waste from commercial and government entities, such as refineries and chemical production facilities, manufacturers, electric utilities, steel mills, and medical and academic institutions. American owns one commercial nuclear waste disposal site and three hazardous waste sites in the United States.


Related Articles:

3 Stocks With Good Dividends and Sales

Garbage in, profits out (A hazardous - waste disposal firm cleans up)

5 signs of a Strong Dividend Stock

Project turns landfill gas into energy in Bay Co.

Kansas landfill to produce, sell electricity

*William (Bill) H. Gates is chairman of Microsoft Corporation, the worldwide leader in software, services and solutions that help people and businesses realize their full potential. Mr. Gates owns 15% of the common shares through his investment vehicle Cascade Investment LLC and The Gates Foundation.

*Mr. Heil is a land developer and private investor, and has owned and operated one of the largest solid waste landfills in the mid western United States. Mr. Heil has more than 40 years experience in the construction and waste service industries and has, since 2002, served as President of E.F. Heil, LLC, operator of a landfill in Plainfield, Illinois. Mr. Heil is a director of American Ecology and the largest individual share holder in the company owning close to 6%of the common stock.