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

To: James Clarke who wrote (4627)	8/7/1998 8:25:00 AM
From: valueminded	Respond to of 78666

James: There primary business is TEL (lead additive to gasoline) but I believe the similarities to USU are far greater than you believe. Couple comments and then my value analysis. You wrote: <Also, they have just one competitor, so you'd think they could keep prices high. But no, they are in a price war. That tells me management is simply inept.> In any business, where supply exceeds demand, there is a price war. Check out MPC's at the <200mhz end for example. I would hardly use that as a basis for ineptness in management. You wrote, management is not buying back shares. Latest press release on July 17, they allocated 15mil for share buyback. I agree allocation is different then actual buying. They won't buy till option pricing set. (USU will behave same way imo) Now my reasoning for it being a value at current price has to do with cash flows. Price: 19/share, Outstanding = 14.4, Total Debt = 348 TEV = 19/share*14.4 +348 = 621 mil EBITDA (June 30qtr) = 56.3 mil Net Income (June 30qtr) = 16.6 mil Amortization (June 30th qtr)=10.2mil 1st Debt payment was June 30 for 40mil, leaving them with 42mil in cash and 348mil debt of which ~ 200mil is snr debt. Expect them to finish pay down of snr debt in ~2 years. TEV/EBITDA ~ 3 which represents a pretty good value even for a declining business. Since excess cash is being used to pay down debt, I expect this number to get better if stock price doesnt respond with the reduction in debt. Agree / Disagree / Comments thanks

To: James Clarke who wrote (4627)	8/7/1998 8:50:00 AM
From: Wallace Rivers	Read Replies (2) \| Respond to of 78666

I'll throw this one out for thread perusal. I've recently decided to take a closer look at it. Rock of Ages Corp (ROAC) - owns granite quarries, markets products from the quarries. Very good results last Q, excellent current ratio, minimal debt. Busted IPO, trading down from price of $18.50 (but what isn't busted in this environment!) Trades at about 1.3 times book. Comments on this company, which does business in a totally unsexy industry out of beautiful Graniteville, VT?