Gencor Industries (NASDAQ:GENC) is a Nasdaq Company with a float of 4.7mm and outstanding shares of 9.5mm. GENC has Cash and Short Term Investments of $9.53 per share, and a book value of $10.79 per share.
GENC closed at $7.90 on Friday. This person wrote a great article on GENC history and why they have so much cash: A Free Business With A Huge Portfolio
Also, the CEO said:
Our strong balance sheet is reflective of sound financial management practices. We believe this will continue to serve us well in the future while we continue to evaluate opportunities for expansion through organic growth and strategic acquisitions.
I believe the reason why the stock has traded so cheaply was due to the lack of a new long-term Highway Bill passed by the government. Noting the last last press release:
However, we continue to remain cautious about the growth of the U.S. economy and in particular the effect upon our industry that the absence of a long term Highway Bill, and adequacy of funding of the Highway Trust Fund may have. Current funding under the ninth SAFETEA-LU extension expires on June 30, 2012. It is uncertain whether a new multiyear bill will be enacted or another short term extension granted.
The great news for GENC is that the new Highway Bill was finally approved last week and has the signature of the President.
This is huge news for GENC, as they stated in their last 10-Q:
The Company believes a new multiyear highway program would have the greatest positive impact on the road construction industry and allow its customers to plan and execute longer term projects.
In 2008, GENC was firing on all cylinders, and the stock hit over $30 per share as they reached $1.59 EPS that year. They did $0.29 EPS last quarter, with about $0.10 coming from operations and the rest from investment income.
I believe with the passage of the Highway Bill, GENC could trade in the $10-$15 range in the short term.
Disclosure: I am long (GENC).