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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: - with a K who wrote (18341)	1/1/2004 6:00:50 PM
From: - with a K	Read Replies (3) \| Respond to of 78497

Thoughts on this exercise: looking at my portfolio for a safe pick to propose was fun, revealing, needed, and somewhat quick (I don't have nearly as many stocks as Paul! ;>) I upgraded my Graham calculations on each stock that has earnings estimates, and feel good overall about my portfolio going into next year. I have some exit strategies for some stocks as they reach my full valuation. Some I may add to or reduce as this exercise pointed out some strong stocks, IMO. What follows are my "honorable mention" stocks I considered proposing before I decided on WRLD. Symbol is followed by my percent to fair value calculation, along with any pertinent notes. I'd be happy to share more notes on any of these if anyone's interested. BEL: 47% undervalued. Already written up. Undiscovered gem. Edit: my largest holding at 12% Enough said; it's only a dirt cleaner. ;>) WM: 144% Gotta still like WaMu at this level. Nice yield. A strong contender for my "safe" pick but too widely held to double in one year??? Still, a long term hold and one I sleep well over. CD: 98% undervalued. Rising estimates. I like the diversity of businesses but need to reduce the debt. finance.yahoo.com Great 1 yr. chart with steady growth of EPS and moneyflow, while PE is below historic norms: bigcharts.marketwatch.com IDR: 115% Only 4 analysts. PE of 16.8 Dale's pick. JNJ: 69% Too many analysts (22) but continue to think this is the bottom. Great ROE and margins, reasonable yield. Much unloved at this time, and that's appealing to me. STHLY: 45% Another Dale pick. Only 2 analysts, and with divergent estimates. ROE 24%; ROA 8.1%; growing margins; PE of 13. 2004 Olympics just around the corner; got a cell phone handy in Athens? Looks good with NAIC growth principles: quicken.com TYC: 86% Rising estimates. A company on the mend making the needed changes. New board and management team; aggressively about to reduce debt. News snip: "As the Financial Times reported on its Web site Sunday, David FitzPatrick, Tyco's chief financial officer, said the company will focus on three areas for cost cutting, expecting to save $1 billion in purchasing costs, make a $1 billion improvement in working capital, and save another $1 billion through "Six Sigma" efficiency programs in factories. Tyco has formed 58 "subteams" to look for moneysaving synergies across the company's businesses, Fisher said. The businesses include electronic security services, fiber-optic networks, medical products, and industrial valves and controls. When FitzPatrick took over as CFO more than a year ago, each of the more than 2,000 companies acquired by Tyco had a separate balance sheet." Internal controls and new leadership in place is leading to improved morale (my sense); conclusion of CEO trial will help stock regardless of outcome, IMO, but I hope Koz goes to jail. I'm guessing most investors are quite wary of TYC, and that's perfect for me! Nice chart, with growing earnings (albeit in the hole a year ago): bigcharts.marketwatch.com UTSI: 101%. Rising estimates. 20% growth forecasted.

To: - with a K who wrote (18341)	1/2/2004 11:09:11 AM
From: - with a K	Read Replies (1) \| Respond to of 78497

Yowsa - WRLD is up over 10% Gee, I wish I would've bought more before I posted. ;>) 10:07AM World Acceptance extends run to resistance at Nov/52-wk high of 20.99 (WRLD) 20.95 +1.06: -- Technical --

To: - with a K who wrote (18341)	1/6/2004 9:39:04 PM
From: - with a K	Respond to of 78497

WRLD in the news: We have also seen strong breakouts in recent days from World Acceptance (NasdaqNM:WRLD - News), Omnicell (NasdaqNM:OMCL - News), Faro Technologies (NasdaqNM:FARO - News) and many others. Breakouts have not really been occurring en masse since the mid-July correction, and they have not been making much progress. In mid-October, the market seemed to enter a correction that affected growth stocks. Names would break above resistance, but were unable to make any headway. I admit that this rally feels different, but there are no guarantees. One thing that will indicate a shift in potential is if some of these growth stocks can break out and advance at least 20% in under 4 weeks. This would indicate a true, potential leader that is capable of a continued advance rather than the 'rollovers' we have seen. World Acceptance has already made a 13% move above its breakout point of 20.47 biz.yahoo.com (with chart)

To: - with a K who wrote (18341)	1/15/2004 12:36:15 PM
From: - with a K	Read Replies (3) \| Respond to of 78497

Completed my buying of KTEC for my "swing for the fences" stock and can finally post my notes. Key Technology is a small ($83 mil revenue; 483 employees) company that makes food- and material-processing automation equipment. Using some rather impressive optical and process technology, their systems are used to evaluate fresh fruits and vegetables, beans, potato chips, snacks, and wood products. Items can be sorted by color, size, and shape to identify defective or inconsistent products for removal by a blast of air while processing huge volumes. The company also makes conveyor and sorting systems for the pharmaceutical, tobacco, and coffee industries. Key Technology has plants in Washington, Oregon, and overseas in the Netherlands. As I was thinking about James' challenge, I was thinking successful picks need to have the following characteristics: under the radar or misunderstood, some inefficiency built into the current stock price, growing if not outstanding fundamentals, and a strong chart. I think KTEC is such a company, but it took some time to complete my DD and build a position. My research led to the pleasant surprise that I had a college buddy who is now a CEO living out of state and sits on the KTEC board. He's a high integrity guy and I trust him; took awhile to get a hold of him but we had a nice conversation about KTEC. KTEC needed some time to digest recent acquisitions and wring out some costs; this plus the downturn in the economy led to a loss in 2001. KTEC's revenues and earnings growth are 21.0% and 200.0%, respectively, in the company's most recent published filing. Q1 results will be announced Jan. 29. The company told me the seasonality of their business has led in the past to strong orders in Q2. They've reduced debt to $6.2 mil in 2003 from $40mil in 2000. Have excess cash now and strong cash flow. The company did $1.15 last year and $.47 in 2002. KTEC does not give EPS guidance, but Needham came out this week with a 2004 estimate of $1.40. (Forward PE of 11.82) When I talked to the company they pointed out that they have a goal to double their revenue in 5 years. Using that 15% growth rate for EPS, I show a nice upside: Company: KTEC Date: 1/12/04 Next year's expected earnings: $1.40 Estimated EPS growth rate: 15 P/E maximum used for estimate: 15 Graham Fair Value: $44.35 Current Price: $16.55 $ difference: $27.80 Percent Growth to Fair Value: 167.9% Per MarketGuide, KTEC's ratios looks good compared to others in the miscellaneous capital goods sector (vs. industry average): P/Cash Flow 11.6 (16.6) P/Free Cash Flow 6.0 (28.7) P/Sales 1.0 (1.8) P/Book 2.6 (4.0) P/Tangible Book 4.3 (6.8) P/E 14.3 (25.1) EPS 5 yr. growth rate 42.6% (3.7%) Total Debt/Equity .1 (.7) ROA 11.4% (6.8%) ROI 17.6% (8.7%) ROE 21.8% (12.5%) Gross Margin 41.1% (31.4%) Profit Margin 7.0% (6.3%) They are #1 in the food and tobacco market (inspection products, 35-40% of revenue) and #1 in fruit, vegetables, and fries (process products, 35-40%). The remaining revenue comes from parts and service. They have 53 US patents and 21 non-US. Even though it is thinly traded, 32% of KTEC stock is held by institutional holders. 4.85mil shares outstanding; 3.9mil float. The presentation held last week at the Needham Growth Conference in New York can be accessed on the Investor Relations page of the Company's web site located at www.key.net/investor.cfm. ValuePro gives an Intrinsic Value of $32 with only a 10% growth rate: valuepro.net Good looking 1 yr. chart. stockcharts.com[h,a]daclyiay[pc20!b50!f][vc60][iut!Ub14!Lc20]&pref=G Stock has been showing strength in the last month. TA indicators look terrific: quotes.barchart.com KTEC has the highest possible rankings for revenue, NI, CF, ROE, ROA, ROIC, debt, PE, PS, and PEG: quicken.com Last Q headline: Key Technology Sales Rise 18% for FY2003 and 21% for Q4 Full Year Diluted EPS hits $1.15, Backlog up 33% Snip: New orders received during the fourth quarter were $23.2 million, compared to $13.6 million in the same period last year. The Company's $20.1 million backlog at September 30, 2003 reflects a 33% increase compared with the $15.1 million backlog at the close of fiscal 2002. CEO comment: "The order volume in the fourth quarter was the highest recorded in the Company's history for that period and reflects what we believe is an improving capital investment environment among our customers. We are particularly pleased that we are winning orders for multiple systems from our larger customers, as this bodes well for future business. While we anticipate some normal seasonal effects during the first quarter of the new fiscal year, we are encouraged with our healthy year-end backlog and are optimistic about our prospects in fiscal year 2004."

To: - with a K who wrote (18341)	1/20/2004 1:08:35 PM
From: - with a K	Read Replies (1) \| Respond to of 78497

WRLD up 3% on 37% rise in net income. 23 new offices. World Acceptance Corporation Reports Record Third Quarter Results Tuesday January 20, 9:56 am ET Adds 23 Offices by Acquisition During the Quarter GREENVILLE, S.C., Jan. 20 /PRNewswire-FirstCall/ -- World Acceptance Corporation (Nasdaq: WRLD - News) today reported higher revenue, net income and loans for its third fiscal quarter ended December 31, 2003. Additionally, it reported the purchase of 23 new offices located in Georgia. "Strong loan demand contributed to our record revenues and net income in the third fiscal quarter," stated Doug Jones, President and CEO. "Our third quarter is traditionally our busiest for loan demand and we added $51.0 million in gross loans during the quarter. Of this amount, an acquisition completed in early December added $6.5 million to gross loans outstanding. Additionally, we added $7.6 million more in early January with the closing of two more acquisitions." Net income for the third quarter rose 37.3% to $4.6 million, or $0.23 per diluted share, compared to $3.4 million, or $0.19 per diluted share, for the same quarter of the prior year. Total revenues for the quarter increased 13.5% to $44.3 million from $39.0 million for the prior year quarter. biz.yahoo.com Per Yahoo, two analysts expect $1.69 next year and 15% growth next 5 years. PEG: .94 Forward PE: 13.7 ROE: 21.8% Company: WRLD Date: 1/20/04 Next year's expected earnings: $1.69 Estimated EPS growth rate: 15 P/E maximum for estimate: 15 Graham Fair Value: $53.54 Current Price: $23.92 $ difference: $29.62 Percent Growth to Fair Value: 123.83%