Conclusion of my initial analysis:
I was asked to look at this company and post my thoughts by someone. Following are my thought:
The year to year comparisons do not look impressive. However, the sequential improvement from the Q ended March 31, 1997, to the Q ended June 30, 1997, has been very good. Based on the press released I posted yesterday, it can be seen that the company expects business to improve over the next 9 months as contracts become effective.
Also, a brokerage (Alex Brown?) recently upgraded ELAMF from a buy to a Strong Buy. Apparently, they believe earnings are going to at least continue at there current pace of about .28 per share.
Based on the .28 per share which they earned last quarer, .28 X 4 = $1.12 forward earnings. That means based on today's price of $11.50 the future PE will only be about 10, low for a company growing revenues at least 20% and earnings which should easily match it. Of course, with more success, they could easily out pace 20% growth in revenues and 20% growth in earnings.
This stock would seem to be a good investment at this point, though I'd like to read the analyst reports on the company to see how fast they think earnings will grow. I wouldn't be surprised to find out that earnings are expected to grow nicely from here.
I may call the company to see what they have to say about future earnings. |
