Bryan Wagman
Long/short equity, value, growth at reasonable price, industrials

P&F Industries: A Potentially Lucrative Microcap

Thesis

P&F Industries (NASDAQ: PFIN), an industrial company with a market cap of just $30 million, currently trades for less than 10 times earnings. The severe price dislocation is likely a result of questionable corporate governance issues in the past as well as the structural issues (illiquidity, lack of a following) that come with many microcaps. Due to the involvement of a particularly effective activist, a series of great acquisitions last year, and consistent growth from all of the company's subsidiaries, I believe the shares will soon correct to fair value, which should be somewhere in the low teens. This indicates significant upside from the current price of $8.43.

Company Overview

P&F Industries operates in two segments: Tools and

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