I don't care about the market, only about individual stocks.
From recent Canadian insider reports, I have noticed that insiders seem to be more confident and that buying are more broadly based than it was some weeks ago.
In any market, you will find values. Take for example this extract of the September issue of newsletter that I write with great English Canadian collaborators.
Canadian Bank Note (TSE - CBK, $1.30) (MODERATE)
We covered CBK in the September 2000 issue.
Since then, the price of CBK's shares reached $1.50 and subsequently pulled back to $1.20. CBK's shares are now even more undervalued than we initially covered it.
Because CBK's shares are thinly traded, investors seem to ignore this turn-around story.
For its second consecutive quarter, CBK realized record sales ending the quarter with revenue of $32.7 million. Net earnings of $1.3 million were a significant improvement over the $0.6 million of earnings for the second quarter of 2000. Year to date, sales of $63.5 million and earnings of $2.1 million are up $17.1 million and $3.5 million respectively over 2000. CBK has been profitable for five consecutive quarters, for us a strong indication that the Corporation is on the right track to finally deliver value for its shareholders.
We still believe that CBK’s shares are grossly undervalued:
· Trading at a deep discount for its book value per share ($2.14)
· At a PSR (price to sale ratio) of less than 0.30.
We believe that there is no reason why CBK’s shares are currently trading at a discount from its book value per share, now that the Corporation has demonstrated that it can deliver positive results.
CBK’s web site can be reach at: cbnco.com
CBK's shares moved from $1.30 to $2.00. O.K., we will tell me that CBK will benefit from an increase in security measures and that explain its strong performance. The point is that CBK's shares were already undervalued.
In conclusion, give me a bear market and I will find more jewels like CBK were.
Have a great weed-end.
Yours truly,
Gilbert |
