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  • Update: ARC Group Earnings Weighed Down By Acquisition Costs
    Thu, Oct. 9 ARCW Comment!

    Summary

    • ARC Group Worldwide reported record sales for their 2014 fiscal year ending in June, but increased expenses related to acquisitions hurt earnings.
    • Adjusted earnings for the quarter were slightly negative, resulting in annual adjusted EPS of 38 cents, well below expectations of 50 cents.
    • Even based on this non-GAAP metric that adds over a million dollars to net income, ARCW still looks expensive at over 35 times earnings.
    • Despite the impressive revenue growth due to acquisitions and an increased focus on 3D printing, I would avoid the stock until they can demonstrate better earnings.
  • A Pair Trade To Play The Bursting 3D Printing Bubble
    Fri, Oct. 3 ARCW, HDNG 3 Comments

    Summary

    • 3D printing stocks continue to decline as investors seem to finally be paying more attention to their still sky high valuations.
    • Another manufacturing company, ARCW, also has ridden the bubble higher even though 3D printing currently accounts for less than 5% of sales.
    • Similar to 3D printing manufacturers, ARCW's earnings could come under pressure due to the haste in embracing the 3D printing hype.
    • Selling ARCW short against going long another undervalued manufacturing company could be a good way to play the deflating 3D printing bubble.
  • Homebuilder UCP Could Rise On Increased Earnings Or A Buyout
    Wed, Sep. 24 UCP 10 Comments

    Summary

    • UCP, Inc. is a small cap homebuilder that develops lots in desirable geographic areas.
    • It has just swung to a profit in the past quarter and is expected to increase earnings dramatically next year.
    • This will allow it to recognize an income tax benefit that will show up as further increased earnings through a lower tax burden going forward.
    • The company also has a large inventory of undeveloped or partially developed lots that are being carried on the books at low purchase prices.
    • Despite this likely understatement of land value, the company trades near book value, making it a desirable buyout candidate for other homebuilders facing tight inventory in desirable locations.
  • MDC Holdings Will Benefit From The Continued Housing Recovery
    Tue, Sep. 16 MDC 3 Comments

    Summary

    • MDC Holdings is an attractive mid-tier homebuilder that operates primarily in the West under the Richmond American name.
    • The company has reported increased revenues and earnings on the back of the housing rebound that began in 2012 and has continued despite naysayers.
    • Increases in both price and volume of sales has been a boon to homebuilder margins and profits, but for the most part their stock prices have not kept up.
    • MDC should continue to benefit from the improved housing environment because of their recent land purchases and strong balance sheet.
    • Despite this desirable geographic and financial position, the stock is also cheap relative to other homebuilders and the overall market.
  • Payments Not Guaranteed To Pay Off For Amazon, No Immediate Threat To PayPal
    Fri, Aug. 15 EBAY, AMZN 17 Comments

    Summary

    • Amazon is making another push into a crowded industry, hoping to steal market share with their usual strategy of undercutting more established players.
    • This would seem to bode poorly for currently dominant PayPal, but I believe they are well enough established, especially with larger retailers, to fend off Amazon's charge.
    • eBay shareholders stand to benefit from the continued strong performance of PayPal, while Amazon shareholders could see just another unprofitable foray into a low margin business.
  • Update: Roundy's Earnings Disappoint
    Thu, Aug. 7 RNDY 16 Comments

    Summary

    • Roundy's earnings disappointed again, despite increased contributions from new Mariano's stores.
    • Same store sales were weak, even at the better performing Mariano's banner.
    • Management seems upbeat about the continued expansion of Mariano's, but an overly aggressive buildout could stretch the company's fragile financial position too thin.
  • Roundy's Could Turn Around Soon
    Fri, Jul. 25 RNDY 45 Comments

    Summary

    • Buying stocks trading at 52 week lows is difficult while markets are near all time highs, since there are not many and you can temporarily look quite foolish.
    • However, these shunned stocks could be where the value is in this overstretched market, if they have a strong enough business to turn things around in a still improving economy.
    • This article will look at a stock currently trading near a 52 week low that offers potential upside due to a solid turnaround plan that is being underestimated.
    • Roundy's is a company that is transitioning to focus on their premium Mariano's brand, but struggling legacy grocery stores and a high debt load are holding them down.
    • The CFO's just announced departure is not a worrisome sign, because he is still a major shareholder and recently joined other insiders in purchasing shares.
  • What To Do When You Can't Find Anything To Buy
    Thu, Jul. 3 AAPL, AMZN, ATW 163 Comments

    Summary

    • With indices at all time highs, value investors like yours truly are struggling to find anything cheap enough to buy.
    • Even slow growing companies are trading at elevated valuations, along with most of the rest of the market.
    • Fast growers are trading at even higher, often absurd, valuations that count on years of sustained high growth rates.
    • Finding growth at a reasonable price remains elusive, unless you're willing to overlook hopefully temporary concerns that are weighing down the rare stock that has pulled back to attractive levels.
  • Quality Closed-End Real Estate Fund Now Trading At A Discount
    Thu, Jun. 19 RFI 21 Comments

    Summary

    • Cohen & Steers Total Return Real Estate Fund is an unleveraged closed-end fund that now trades at a significant discount to its holdings of quality equity REITs.
    • A merger with another fund seems to have temporarily brought down the price even further below their most recent net asset value.
    • A dividend increase announced with the merger has brought the annualized yield up to an enticing 7.8%.
  • Buy Axiall As Short-Term Issues Temporarily Drag Down Earnings
       • Mon, May. 12 AXLL 1 Comment

    Summary

    • Formed by a recent spin-off and subsequent merger, Axiall Corporation's diverse product lineup of chemicals and building materials offers strong long-term earnings power.
    • Recent issues are obscuring the cost savings likely to be realized through synergies and masking the potential long-term earnings power of the combined company.
    • A number of recent setbacks led to temporarily depressed earnings and an opportunity to buy shares at a discount.
  • TJX Should Buy Ross, And So Should You
    Thu, Apr. 24 ROST 10 Comments

    Summary

    • Ross Stores is trading at a very reasonable valuation given its impressive revenue and earnings growth history.
    • The discount retailer would be a natural fit in the portfolio of stores operated by the larger competitor TJX.
    • TJX could use their strong balance sheet to accelerate their own expansion by buying all of Ross Stores while it's on sale.
  • Monitoring The Cheap Oil Services Company, Geospace Technologies
    Wed, Apr. 9 GEOS 18 Comments

    Summary

    • Geospace Technologies is trading at a very low valuation given its strong earnings growth history.
    • The company is now even cheaper after the market overreacted to a contract delay.
    • This gives investors a good opportunity to benefit from the potential of its innovative new products.
  • Green Mountain's Pop Will Fizzle Out
    Fri, Feb. 7 GMCR 31 Comments
  • Atwood Oceanics Cheap Due To Unrelated Weakness
       • Tue, Jan. 28 ATW 13 Comments
  • Denbury Resources: A Pure Play On Enhanced Oil Production
    Wed, Jan. 22 DNR 8 Comments
  • A SodaStream Mea Culpa
    Wed, Jan. 22 SODA 51 Comments
  • Don't Count On Growth Forever From Chipotle
    Mon, Jan. 20 CMG 14 Comments
  • Conn's Is Creating A New Subprime Lending Bubble
    Thu, Jan. 9 CONN 45 Comments
  • Buy GSV Capital Before The Next NAV Report
       • Dec. 20, 2013 GSVC 37 Comments
  • Harbinger Group Still On Sale, Will Leucadia Buy It All?
       • Dec. 19, 2013 HRG 4 Comments
  • Buy Some Portfolio Insurance While It's Cheap
    Dec. 10, 2013 VXX, UVXY, TVIX 28 Comments
  • Could Salesforce.com Be Fudging Their Sales Numbers?
    Nov. 20, 2013 CRM 79 Comments
  • EMC Stores Big Data And Big Value
    Oct. 24, 2013 EMC 6 Comments
  • eBay's Wonderful Businesses Now Available At A Fair Price
    Oct. 21, 2013 EBAY 15 Comments
  • The Importance Of A Maintenance-Free Moat
    Oct. 16, 2013 TEVA 5 Comments
  • Buying A Business For Half Price At Mr. Market's Estate Sale
    Oct. 10, 2013 DPS 19 Comments
  • Potential Deal Could Benefit These Two Undervalued Miners
    Sep. 27, 2013 VGZ, PPP 14 Comments
  • Use The Twitter IPO News To Exit Poorly Managed GSV Capital
    Sep. 13, 2013 GSVC 47 Comments
  • Investors Should Be Aware Of This Obscure Biometrics Company
    Sep. 12, 2013 AWRE 16 Comments
  • Using The Kelly Criterion To Deploy Cash During Pullbacks
    Aug. 31, 2013 SPY 71 Comments
  • Buy Red Hot Spectrum Brands At A Discount Through Harbinger
       • Jun. 19, 2013 HRG 17 Comments
  • Worried About A Silver Selloff? Buy Silver Wheaton Instead
    Apr. 16, 2013 SLW 47 Comments