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

To: Paul Senior who wrote (31828)	8/22/2008 1:01:16 PM
From: Jurgis Bekepuris	Read Replies (1) \| Respond to of 78774

DSWL - I'll comment on that to explain my investment thought processes. DSWL falls into a black hole between two areas where I invest. On one hand, there are high margin, high ROE companies, which DSWL was at one time. It is not anymore. On the other hand, I look for profitable companies selling below NCAV/cash. DSWL does not fit into that either. They are selling below book, but most of the book is capital equipment, which is always less attractive. There is also an issue of inventories + AR being about 2x quarter sales. A bit high. Finally, I am not sure I see bright future for DSWL in terms of what could go right so it would become a better company in terms of sales, ROE, etc. So I will skip.

To: Paul Senior who wrote (31828)	8/22/2008 7:55:29 PM
From: Spekulatius	Respond to of 78774

DSWL - i bought some too at 4.71$ today. it's a mediocre company in terms of the business prospects (IMO) but it's trading at a cigar but price. i see several ways i come out OK. 1) DSWL continues to pay the current dividend. Business stays ho-hum (10% yield is an Ok financial return) 2) Stock spikes up due to improved general sentiment and I'll get out. (most likely scenario) 3) Business improves and everything is great. Of course things could go the other way, but I think at that point the odds favor that shareholder will do OK. At least that is what I am betting on with a very moderate position.