To: Cary C who wrote (11677 ) 12/25/1998 9:41:00 AM From: Sergio H Respond to of 29382
Cary, I'm taking a break from XMAS activities to scoop you on APCO. (Will it sell on the news?...LOL) Two Small-cap Gurus Bullish on Auto Warranty Firm (APCO) Monday, December 21, 1998 Two leading small-cap advisors are so bullish about Automobile Protection Corporation (APCO) that both made it their top pick of the month. The firm markets and administers vehicle service contracts and extended warranty programs that are then sold by new and used auto dealers in the US. "(APCO) has maintained steady growth for several years and has the potential to grow at about 25% per year in the coming two years," says Richard Geist. He calls APCO "a classic growth company" and sees potential for continued top and bottom line growth. Geist also cites record revenues and earnings for Q3 98 and a compound annual revenue growth rate of 37% over the past three years. "The reason to check out APCO is for its alliances and earnings history, not just because it beat earnings expectations," says Jon Steinberg. The company achieved its 23rd consecutive quarter of record revenues by steadily adding key relationships with companies like Honda, Allstate and BancOne. But the firm's greatest strengths are in its financials, he says, noting "sterling" balance sheet ($29 million in the bank, $2.34 per share) and cash flow statements ($7.5 million in cash flow this year, $9 million predicted next year.). Steinberg maintains a buy recommendation with a 12-month price target of $16, 25x his FY 99 estimate of $0.64 per share. For more on Richard Geist's recommendation see "Highlighted Stocks," December 1998, Richard Geist's Strategic Investing. Richard Geist integrates psychological aspects of investing into a methodology for selecting small company stocks.investools.com