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Strategies & Market Trends : Value Investing
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To: Michael Burry who wrote (8175)9/8/1999 4:01:00 PM
From: James Clarke  Read Replies (4) of 78822
 
Catalyst #2 at Maxwell Shoe just fired, and the stock is down to $8. I just doubled my position. The quarterly financials were released today and picked up the sale of the Jones licence. Since that was an intangible asset before (not on balance sheet), the sale of it raised book value by $1.24 a share. It also boosted the cash balance to $52 million. The stock will now show up for anybody doing a net-net screen.

So now what we have is a $70 million market cap backed by $52 in cash and a business that has been consistently profitable. Net net is about $9.50 a share, book value of about $11.50.

To review the catalysts:
#1 was signing on new business to begin to replace the lost Jones business. They signed Anne Klein last month and began showing product in August.
#2 was the release of the quarter which reveals the valuation of this stock to investors doing screens.
#3 will be when they find something to do with the cash. Either a massive share buyback, a special dividend, or more likely an acquisition.
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