Looking for a new stock to invest in....found this on the Falling Angels stock site:
Penny Stock Portfolio
A Weekly Publication, Issue #16
December 13, 1999 :: 12:30pm EDT
Here is this week's review of penny stocks that you might
want to consider in your penny stock portfolio:
Key Tronic Corporation (NASDAQ: KTCC)
Current Share Price: $4.125
Risk Factor: 1 (low)
Payoff Factor: 3 (Moderate)
Time Frame Factor: 3 (1 year)
Reviewed by Louis Ambio
Current Position By Reviewer: None
Key Tronic Corporation (NASDAQ: KTCC) is one of the
world's largest manufacturers of computer keyboards and one of
the fastest growing Original Design Manufacturers in the US. In
recent years, Key Tronic has diversified its own product line into
Distribution and Retail markets, as well as its ODM business.
Now as an emerging leader in contract engineering and
manufacturing, Key Tronic employees 2,700 people with
production, sales and distribution facilities in the US, Mexico,
Ireland, China, Netherlands and France.
In the company's first fiscal quarter of 2000, it reported
total revenue of $41.8 million, compared to $42.3 million for the
first quarter of fiscal 1999, while net income for the first quarter
was $210,000, or $0.02 per diluted share, compared to
$493,000 or $0.05 per share for the same period last year.
These numbers exhibit decreasing sales and earnings, a bad
sign for any company. However, a deeper look into the results
shows the switch in focus for Key Tronic, a switch that could
lead the company towards a higher level of profitability. The
company's non-keyboard original design manufacturing (or
ODM) business was $19.2 million, or 46% of total revenue, up
190% from $6.6 million, or 16% of total revenue, for the first
quarter of fiscal 1999. Simply, the company's total revenue and
profitability was adversely affected by market weakness among
major keyboard distributors in Europe and the U.S., as well as
sustained worldwide pricing pressure on keyboards. But in the
long run, Key Tronic should become less dependent on these
businesses.
Presently, only one analyst follows KTCC, and it is
covered with a strong buy rating. Key Tronic is expected to
increase earnings 125% this year, and then by another 20%
each year over the next five. Therefore, if Key Tronic is able to
turn their fortunes around, this Nasdaq small cap could
represent a great value trading at only 21 times estimated fiscal
2000 earnings. |
