JLMI, a profitable chemical company, trades at 5, down from 11 earlier this year. This is another stock I turned up doing a screen, which I followed up by reading the SEC filings and news releases.
Mkt cap $35 M, p/e of 5, p/b 0.81, PSR 0.12,
clean balance sheet with debt/equity of 0.3
Yahoo's chart etc.:
quote.yahoo.com
Yahoo profile:
biz.yahoo.com
The co. has about 100 employees, and a plant in Illinois, located close to an oil refiner. They buy a certain petroleum product, which they separate into acetone and phenol, which are two commodity chemicals. Acetone is a solvent, used for example as finger-nail polish remover.
They run at 100% capacity all the time. Profits are determined solely by the competitive price that they can charge for their commodity product. Transportation is a significant cost of these chemicals, so competition does have its limits. The co. has said in a news release that it expects eps and revenues to be flat or down slightly. The only risk I see here is that the co.'s net margin is low, so that a slight drop in selling price of the product will turn a profit into a loss.
The one analyst who follows the co., and who seems to have a pretty good record at predicting next quarters eps, is expecting $0.90 profits for 1999, vs. $0.94 for 1998. That puts the forward eps at about 5.55. Unless acquisitions pay off, the co. will have no growth. |
