<I'm wondering--why is this stock so damn cheap?>> Lomez, I think this is clearly the big question! There's not an easy one sentence answer, but if you've been following this company, you'll recognize the very wide price swings when they've disappointed in the past. I won't list all of the positives, as I think you already are aware of them. Here are some of the reasons this company continues to be overlooked:
1. Float--just not enough shares available for the big boys to jump on board.
2. Analyst coverage-- current coverage is by small, regional firms. However, Jeffries, I guess, isn't all that small. The last large house to cover was Smith Barney. That was a fiasco. SB clearly had an axe to grind with management, screwed up a secondary, put a sell on the company, then dropped coverage all together after all of the bad things they wished on the company didn't occur. Thanks again, Smith Barney.
By the way, Oppenheimer was on the last call....
3. Lack of earnings stability. This has changed dramatically under the new CFO.
4. Keep in mind there are a bunch of Cajuns running the company <G>.
But, really, I think they do come off as a little slow. I respect SGR's management and don't intend this to sound flippant, but in talking to others who have been on the conference calls, I really think they have a difficult time with how things are presented. I think Ed Paigano, the new CFO, does a FAR better job in presenting during the conference call than does the CEO.
Those are my top 4 reasons, but there may be others which I can't think of. I'm clearly very high on this company. As one of the analysts stated, "this is a FAR better company than it was when it was trading at 36!" So? If I sell it today, I'm still more than 11 points down from that price! Look, I'm in this stock from anywhere from $4 to some in the mid 20's. I like this company....you can certainly read the posts on this thread to get that point of view. SGR has certainly helped me with my patience level!
regards,
greg |
