Benny,
While I periodically check in on NENG, I do not own any shares. I took a look at their second quarter report and two things caught my attention. First, their gross margin percentage for the second quarter was 16.1%, down from last year's 20.8% and less than the company's 17% to 18% prior guidance. Secondly, they are suggesting that their GAAP results for the year will fall into a range of a $300,000 profit to a $300,000 loss. I think that they were hoping that the acquisition of Alliance Systems would be a game changer, but that has not been the case so far. The Alliance Systems business, like the core NENG business, is low margin.
According to Yahoo, there are no analysts following NENG.
NENG posted a profit last year, their first profit since 1996.
Operating income (loss):
2007: $668,000
2006: ($6,757,000)
2005: ($16,576,000)
2004: ($1,908,000)
2003: ($1,949,000)
2002: ($15,717,000)
2001: ($74,674,000)
2000: ($14,518,000)
1999: ($5,247,000)
1998: ($3,625,000)
1997: ($1,124,000)
1996: $127,000
I personally would not be a buyer until the company shows some consistent profitability.
Regards,
Glenn |
