The best 'long term buy' I see out there (non technology) is
Pre-paid legal services. (PPD, AMEX market). They are similar to an
HMO, but for legal services. They sell legal plans (to 'regular people', business, etc..) for as little as $16/month. The market is
absolutely HUGE (at least 5 billion+) and they are the only publicily
traded company in the business.
Now, why am I so hot on them.. Well, they have a very interesting
marketing strategy that works 'geometrically', resulting an an almost
doubling in membership year over year for the last 3 years. About 2
years ago, they passed the 'critical mass' which allowed earnings
to explode as the doubling effect finally made a difference. (think
of starting from '2', double that number, and so on.. )
earnings? (stock price @ 12 5/8)
1993 .01/share 20.3m rev
1994 .21/share 24.6m
1995 .34/share 36.1m
1996 .56/share 61.1m P/E=22.5
1997e .90/share 100.6m P/E=14.0
1998e 1.33/share 156.8m P/E= 9.5
growth rates at 60%+/year, NO DEBT, 15 million in cash, positive cash
flow. check out the PPD thread, I posted some info there.
anyway, check it out... Stock got hammered in the correction, and
hasn't really come back. (it hides out on the AMEX.. move to NYSE
is possible. The assets are there)
kp |
