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Strategies & Market Trends : Value Investing

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To: Paul Senior who wrote (16552)	3/7/2003 4:41:13 PM
From: Paul Senior	of 78691

Buying a very small amount of RSCR. biz.yahoo.com Selling at p/e 5-6x, if management can deliver their .50-.55 promise for next year. biz.yahoo.com And that might be possible. P/sales is low at .07. So there might be some room for margin improvement. Book value is about $7.2/sh vs. stock price close of $2.79/sh. In past good years, the company's shown an ROE of 15% or more, so $1.00/sh might be possible m-a-y-b-e at some way-in-the-future date. Two howevers: 1)gov't pays for RSCR patients and gov't may have altered payment amounts or rules such that those past good times might not recur. 2) Debt is high. (d/e = 1.43, per Yahoo). President/CEO Geary, who sold stock at $8 level (5/'02) became a buyer (12/'02) at $2.75. At current price, I'll bet that upside potential is greater than downside risk. jmo. Paul Senior

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