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Strategies & Market Trends : Value Investing

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From: E_K_S	2/19/2016 6:23:59 PM
	Read Replies (3) of 78751

Re: Richardson Electronics Ltd. (RELL) - Value trap? Link to ADVFN financials Anybody look at RELL as a 'Value" Buy lately. I see that Paul added shares in August 2015 from a search on the thread. This one popped up on my value screen. I looked at the 2015 annual report and see that a good chunk of their BV was written off from obsolete inventory. It seems like it was unusually large. For that reason will wait until this one sell's off down into the $4.50/share level. Dividend is attractive and at that price level would yield over 5%. Their product mix seem to be targeted to high margin specialty end user technology markets. I think if inventory management is a problem, they can fix that w/ an updated software solution. At 0.5x Price/Sales & 0.5x Price/Book, there is no reason why they s/d not be booking a profit. SG&A seems a bit high at 36% of revenues so get that down below 30% and they s/d have pretty good earnings. The company has no long term debt and over $7.00/share in cash. I do not know what I am missing other than I missed some huge liability the market is pricing into the stock (ie worthless inventory, law suit or other litigation, fraud). What am I missing? This analysis was done April 2015 when the stock was $8.70/share. Richardson Electronics: A Graham And Schloss Play EKS

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