New Capital
Contrarian, deep value, long/short equity, special situations

Emeco: Negative Developments Not Yet Reflected In The Price

I have expressed my pessimism over Emeco Holdings (OTCPK:EOHDF) in a previous article. The latest developments during the quarter seem to indicate that the bearish thesis is actually working out, but is not yet reflected in the market price, which remained relatively flat during the recent months.

As a recap, Emeco is an Australian company that owns and rents out earth moving equipment to the mining sector. The bullish argument for investing in Emeco is mainly based on the company currently trading significantly below its liquidation value and selling down assets to reduce debt. I have argued that the liquidation value (or book value) is likely to be overstated as industry is in a prolonged downturn cycle...

Join Seeking Alpha PRO to read this archived article and 11,574 other archived articles
FREESA PRO MEMBERS
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