10 Reasons To Buy YRC Worldwide

| About: YRC Worldwide, (YRCW)

1. Be greedy when others are fearful. And be fearful when others are greedy. YRC Worldwide, Inc. (YRCW) has nearly 7 million shares outstanding trading at an approximate $39 million market capitalization as of 5 April 2012. What logical reason is there for a low stock price on a company which commands $5 billion in revenues per year? It is aiming to earn $250 million EBITDA by 2012 year end and $450 million EBITDA by 2013 year end.

2. YRCW's discounted cash flow model's conservative valuation indicates a $60 per share value whilst taking into consideration share dilution from convertible debts. This puts a $1 billion enterprise value on the firm. Have you considered reviewing historic stock prices and market cap for the company and compared those highs to the non-logical current low?

3. Simple math on lower diesel prices majorly boosts company value. The company consumes 175 million gallons of diesel per year. For each downward $0.25 per gallon of diesel, YRCW saves $44 million in fuel. To put this in perspective, investors are concerned and voting by selling the YRCW stock to a market cap less than this simple cost savings. Diesel down, YRCW up - Bingo! When diesel returns toward its ten year average of about $2.00 per gallon, the company will save $350 million, which is about 9 times the 5 April 2012 market cap. Want to see earnings increase? When more of the diesel refineries soon come back online, diesel supplies will increase and diesel prices will decrease. There are about 161 diesel refineries in the USA. There are at least 80 on scheduled shut-down for maintenance. The USA is exporting two times as much diesel to Latin America since 2007 (two million barrels per day versus one million barrels per day), which increases diesel prices. The energy industry is winning on diesel demand and margins for the moment. The energy industry will trip over itself once it starts production of new diesel supplies. The price of diesel will decrease due to competition and abundant supplies.

4. Lenders are flexible, willing to work with the company, and not pushing management or the company to take the route of bankruptcy. YRCW will reach an agreement to work with lenders on loan terms, rates, covenants and conditions. Lenders are working with the company. There is liquidity and breathing room to allow for an ongoing concern. The infrastructure and foundation are in place for rebuilding and development during the current rebound in the economy.

5. 32,000 Teamster union workers are cheering for success and voting for employment in order to see YRCW win. They want YRCW to stay in business for employment purposes and upside in the equity. The Teamsters want to make a living and provide for their families. There are approximately 237 recorded shareholders of YRCW on file according to Thomson Reuters. Who has more leverage: 32,000 Teamsters or 237 shareholders? Where is the American dream of capitalism, business and employees supporting their families? How will all stakeholders win? Guess what? The 32,000 union workers support YRCW. They even have their pension fund supporting the company. Do you think a Teamster will be defeated? Be courageous and bold to support YRCW. Invest smart. Ask not what YRCW can do for you. Instead ask what you can do for YRCW. Then we will all profit. Perhaps your firm has the ability to support a turnaround venture. Or perhaps your firm could be a customer. Help keep the cash flows and faith in the business.

6. Management is new, seasoned, ready, willing and able to make a turnaround. It takes new blood with a solid pedigree to work through problems and obstacles established by former broken governance. With the current board and executive management team in place, YRCW will succeed. Current management is responsive to all stakeholders. Steward, LLC owns and maintains a long-term hold on 14,000 shares, which is small by comparison to other firms. However, management favorably took time to respond to our inquiries and our suggested ideas to unlock YRCW value. News articles indicate YRCW's implementation on some of these ideas. Furthermore, it is clear in several reports and articles that management is keen on reducing debt. With a highly leveraged company reducing its debt, there will be large equity returns upside.

7. There's gold in them there hills. YRCW is grossly undervalued. What was the reason you considered or first bought YRCW? You may know the brands. You may see its upside. You may like trucking, shipping and logistics. You may want to have the rights of ownership to future cash flows. You may see the company is able to turn around. You may see the cash generating ability it has with its 15,000 tractors, 48,300 trailers and 5,700 forklifts. Think about the replacement costs and values of these assets. For Steward, LLC it is all of the above and several other reasons.

8. Assets are in reality greater than liabilities. How? The balance sheet includes a snapshot of depreciated and further depreciated assets. Some assets are depreciated to zero and not visible on the balance sheet. Take Sears Holdings (SHLD) for example. Lampert is publicly selling off-balance sheet Sears assets to provide cash for reinvestment. YRCW owns numerous non-core valuable assets including real properties to sell to raise cash to reinvest into the business. You will discover a recent article dated 5 April 2012 on the sale of terminals to the highest bidder. Also, YRCW recently and prudently sold its interests in a Chinese subsidiary to focus on North America. Do you own assets generally invisible to the public? Likely yes you do. Could you sell them to sustain your business or lifestyle? Likely yes you could. So does and so is YRCW to maintain cash flows and its ongoing concern status.

9. The USA and North America as a whole are on the economic and fiscal mends and rebound. Steward, LLC digs through detailed data on companies and macroeconomics. It is our business. I am a US citizen. I have resided in South Africa since 2008. I return to the USA three to four times per year on average. During the past six years I have witnessed the ground effect the economy has had throughout the world. And during the past four years living across the globe I can see with a more objective perspective. The more than five trips to the USA in the past 18 months for professional and personal reasons, I have seen a significant and visible uptick in the US economy. More people are employed. More people are buying goods. More trucks are on the road. More revenues and profits are being earned. Wake up people, the tide has changed. Things are better. People are discovering employment. Consumers are spending. Houses are being sold and built. Who will ship consumer goods? Who will ship housing materials? Who will benefit from products and services increasing on the macro-scale in the USA? YRCW will benefit with increases in revenues and earnings. The company will achieve $5.0 billion in revenues by 2012 year end and $5.4 billion in revenues by 2013 year end.

10. See the forest - not just the trees. Have a long-term view on YRCW. It is not a get-rich quick scheme. It is grossly undervalued and will turnaround. Warren Buffett through his Berkshire Hathaway holdings paid chump change of $40 billion for the ownership of Burlington Northern railroads. Buffett buys America. He believes in America's future. We believe in America's future. Transporting goods is part of America's present and future. One billion dollars ($1,000,000,000) does not have enough meaning behind it on the underlying value of YRCW assets and future cash flows. Price is what we pay and value is what we get.

In summary, unless the US is going to stop shipping goods, having babies, buying products, or fall into the oceans, we propose you re-evaluate the likelihood of YRCW's success. Have a more detailed review of its underlying value. Here is some homework for you to discover a turnaround from $2 million market cap low to $2.5 billion (yes, "m" for "million" to "b" for "billion"). See Tronox (NYSE:TROX) - it weathered the financial storm to overcome obstacles from January 2009 through January 2011. YRCW is weathering the storm and overcoming obstacles. YRCW will keep on trucking.

Disclosure: I am long YRCW.