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

To: bruwin who wrote (21608)	7/6/2005 4:12:11 PM
From: itilis2003	Read Replies (3) \| Respond to of 78763

MHCO is cheap by most measures. Price/book Price/sales Price/earnings Price/Net current assets Insiders own the vast majority and they continue to buyback shares. (Notice the sharecount has been declining for years) I wouldnt be suprised if the company is sold because of the age of the chairman, the president and board members. The fact that its down from its 52 week high of $4.75 is simply the liquidity or lack thereof. That and the last quarter was a little disapointing. But MHCO runs the business for the long term, not for quarter to quarter expectations. I first bought the stock at $1.03 and have averaged up over the years as all the evidence suggests they continue to build shareholder value. I expect at some point in the future, MHCO will trade at or very near its book value. And that book value increases every year. $8.724 book value at 3/31 Diluted book value was $8.316 From shareholders letter 4/18: Entered into a new 4 year contract with warehouse & delivery associates -will provide them with substaintial wage and benefit increases. Substatial contining investment in equipment,along with intensive job training and clear incentives, have enabled us to control our unit logistics costs while making MHCO a better place to work thereby reducing turnover. Strengthened our "hardware house" brands by adding seasoned import exectutive who is responsible for global sourcing. Brought with him an experienced team on the ground in the far east. *Hired a seasoned sales executive to establish rep organizations nationwide for Hardware House products, to accelerate national penetration with these brands. Expect 2005 to show first results from this effort. -- Sounds like they are investing for the longer term. Which I guess is why first quarter EPS were below last years. How many $3.50 stocks earned 11 cents last quarter while investing for the longer term ? Finally, although I never buy a stock soley for a pump & dump, the fact that its a "low float" stock that COULD get it pumped & dumped. Even pinksheeters are getting pumped & dumped it seems. Look at CDEN.PK today. From $3.55 yesterday to $9 today.

To: bruwin who wrote (21608)	7/6/2005 4:48:47 PM
From: MCsweet	Respond to of 78763

Bruwin, Thanks for looking at MHCO. I was not touting MHCO as a current buy (although I do still hold a few shares), but as an example of a Paul Senior recommendation that I made some money on. However, itilis2003 seems to have this stock down cold --- I have nothing to add to his analysis. Several academic studies have shown Price/Book does quite well --- it is not just my opinion. "What Works on Wall Street" found that Price/Sales did best, but that book overall has not seemed to have stood the test of time. Read Dreman's "Contrarian Investing" or Haugen's "New Finance" or read CFA study materials (I just took level 3 in June). I believe all of these resources demonstrate that Price/Book holds up best or close-to-best among screening criteria. However, I have seen it so many times I tend to get my sources confused. I would think a Graham expert would be already be taking an asset-driven spin on things --- looking at a owning the company as a real business, you would want to buy it for its assets in addition to earnings power. Sure, Graham emphasized current assets, but overall he has an a book-value driven mindset IMO. MC