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

To: Broken_Clock who wrote (23174)	1/20/2006 3:47:14 PM
From: bruwin	Read Replies (1) \| Respond to of 78631

Well, as I said in my post, all I could see on its latest Balance Sheet for Quarter ending Sep. 2005, was a Long Term Debt of $128.4mil., giving it a Debt/Equity of 51%. I also said that I didn't know whether or not that was all interest bearing. I suspect maybe it isn't, because the Interest Expense per Quarter seems to be relatively low, compared to the $23.7mil. the debt cost for $171.6mil. over a 12 month period. There is $193mil. in Cash and Equivalents on their Balance Sheet. I wonder why they then sit with $128mil. of debt which is costing them money, when they don't appear to be earning anything with that cash, based on the fact that "Interest Income" on any of their Income Statements shows zero ? Anyway, it's certainly a good thing if ALJ's management are going to repay debt because it certainly has cost them enough in the past !

To: Broken_Clock who wrote (23174)	1/20/2006 5:39:12 PM
From: Grommit	Read Replies (3) \| Respond to of 78631

ALJ -- I haven't bought ALJ yet, but I think it a good one to own. I recently choose to buy more VLO instead. Larger and safer, IMO. PE's around the same. today's numbers from yahoo: VLO $60 EPS 2005 $6.64, PE 9.0 EPS 2006 $7.53, PE 8.0 ALJ $21.33 EPS 2005 $1.99, PE 10.7 EPS 2006 $2.31, PE 9.2 finance.yahoo.com ............. 60 minutes and oil sands. thanks for posting. it might be good to watch, but the word is already out. maybe they will talk about all the problems -- labor shortage, housing shortage, nat gas usage.... my favorites: finance.yahoo.com I think the oil sands are still undervalued. example -- there is a fresh odlum brown analyst report which project COS dividends to increase from CAN$4 this year, to CAN $11 in 2007. that's becasuse COS will have completed their capital spending and they open the tap to produce oil. However the projection is based on US$55 oil. at US$64 oil, the dividend could be CAN$4 higher, they say. that's CAN$15 on a stocks at CAN$150. all the oil sands have that upside. the analysts are all playing it safe on the projections. maybe it is offset somwehat by some construction delays not visible. anyway -- these companies will sell all the product they can produce, the only question is the price. my portfolio is still 70% oil sands, as i posted here last summer.

To: Broken_Clock who wrote (23174)	1/21/2006 1:43:22 AM
From: bruwin	Read Replies (1) \| Respond to of 78631

It seems, This_is_the_end, that I took your original post 23165 to mean that ALJ's loan repayment was already reflected in its latest Balance Sheet, which is why the numbers didn't seem to gel. Unless I'm mistaken, the terms of that loan seem rather onerous insofar that the company gets penalised if they want to pay it back early ! If that's the case, it possibly explains why they sat with Cash on their Balance Sheet which they could have used to reduce their ongoing Interest Expense as reflected in their Income Statement. Apart from their recent debt situation, the rest of their fundamentals, in my opinion, seem in good shape. However, what do you think about the fact that their last Quarterly Revenue went up by about 10%, yet their Operating Margin fell by about 20%, with a knock-on 11% reduction in their Bottom Line ?