Value Investing Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Value Investing

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

Recommended by:

Mattyice

To: cink40 who wrote (55018)	4/18/2015 12:01:52 PM
From: E_K_S	1 Recommendation Read Replies (1) of 78912

Sterling Construction Co. Inc. (STRL) - Added shares at $3.92/share (a 17% increase Buy) Stock sold off Friday and I had the chance to buy back shares I sold at $4.50/share. I did this since the company announced two new contract awards w/i last 30 days that account for a 9% increase to their already large back order book of business. The new CEO was concerned that the previous management was bidding on jobs too low (not enough margin) and he was only going to submit bids that provided higher than historical margins (and would allow for cost over runs). Since the new CEO has his return tied to equity. . .Mr. Varello’s employment agreement calls for an annual salary of $1.00, and an award of 600,000 shares of restricted common stock that vests over three years. Therefore, I have raised my fair value target up to the $7.50/share-$8.00/share range. It actually could go higher if/when the CEO reports consecutive earnings that show higher net margins. My position is still small only 0.5% of my taxable portfolio. I may increase the position by another 30% at/or below $4.00/share on any sell off. The stock can be thinly traded and any large holder that is looking to book their gains from the fire sale sell off ( up over 86% from the 3/6/2015 low of $2.25/share) may temporarily move the stock price into my buy point. I would say that since the CEO has a three year time horizon for his restricted shares to be vested, the stock could make it back to it's previous 3 year price range of $11.00/share to $14.00/share. STRL is a small cap with a market of $78.83mln. If/when those higher profit margins begin to kick in, they s/d move the needle enough to get the price back to it's 3 year historical average (ie. reversion to the mean). EKS

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next