John Leonard, CFA
Special situations, micro-cap, contrarian, CFA

Asset Sales At Video Display Should Narrow The Disconnect Between Book And Market Value

Key takeaways

  • Video Display (NASDAQ:VIDE) is a classic balance sheet play as the proceeds from the recent sale of a subsidiary highlight the value to be unlocked from additional asset sales.
  • The sale proceeds were used to eliminate net debt, which reduces the risk of any further delay for the sale of two additional subsidiaries.
  • The improving outlook for the remaining subsidiaries should result in a higher sale price if management continues this disposition strategy or a higher valuation for the smaller but more focused company if not.
  • Insiders have a significant incentive to pursue the strategy that maximizes shareholder value given that they have the most to gain (and lose) with 74% ownership.

Company overview

VIDE manufactures...

Join Seeking Alpha PRO to read this archived article and 11,574 other archived articles
IDEA GENERATORXExclusive access to 10 PRO ideas every day
INVESTING IDEAS LIBRARYXExclusive access to PRO library of more than 15,000 ideas
SECTOR EXPERT NETWORKXExclusive access to all sector experts for direct consultation
PERFORMANCE TRACKINGXTrack performance of all PRO stock ideas
PROFESSIONAL TOOLSXProfessional Idea Filters to zero-in based on industry, market cap and more
"In just the first month of using PRO, I used it to generate two ideas which were actionable for me. As a result of these two positions, I have earned more than 20 times the annual subscription costs for PRO."Michael Yagemann, Greenbridge Capital
"I am pleasantly surprised with the scope of small and mid-cap coverage PRO offers. You can't find that any where else."Patrick Rice, Mainstay Capital Management
You may cancel at any time for any reason, and receive a prompt refund for membership on months paid and not used (max. 6 months). Details