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William Garrison  

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  • Armco Metals Holdings Gets Hit With A Big Inventory Write-Down [View article]
    I will be quite surprised if this stock is able to rally between now and the end of the year. AMCO has resorted to additional toxic financing to pay off its short-term loans.

    If the company gets shareholder approval for the equity issuance, investors can expect to see somewhere between 10-20 million new shares issued to pay for the $4.1 million loan. Shares outstanding are around 8.2 million currently. I no longer own shares in the company.
    Sep 10, 2015. 10:12 AM | 1 Like Like |Link to Comment
  • Armco Metals Holdings Gets Hit With A Big Inventory Write-Down [View article]
    I do endure periods of feeling like a "mediocre investor", but the investment case for AMCO changed following the release of its second quarter results in my opinion. With less than $1 million in cash as of 6/30/15, AMCO's top priority should be figuring out how to pay off its more than $10 million in short-term loans. Instead, from the middle of May to the middle of July, AMCO 1) issued over 1.2 million shares to an investor group at an ongoing 15% discount to pay off a convertible note; 2) made scrap metal purchases that resulted in the gross profit position swinging from a positive $4.9 million to a negative $3.9 million; and 3) continued to chase barley sales to no avail but did make $20,000 by lining up a $17 million raw wood trade in the third quarter. AMCO is cheap on many metrics, but until there's better visibility on the debt situation, I don't think it will matter.
    Aug 19, 2015. 01:00 AM | 1 Like Like |Link to Comment
  • Sifting Through The Scraps In China's Steel Market [View article]
    AMCO completed a 1 for 10 reverse split in early January of this year. As noted in the article, I expect shares outstanding will continue to expand to more than 8 million by the end of the third quarter. I believe we might see the second quarter earnings report after the market closes today or before the market opens tomorrow. I'm expecting to see a nice profit per share and will be watching to see if the company was able to generate a strong level of free cash flow. If inventories remain stable and accounts receivable are down significantly, I think the stock should bounce nicely from today's depressed levels. If receivables haven't come down, investors likely will continue to worry about how the company is going to finance its short-term bank loans which are coming due in the second half of this year. I like the risk/reward at these levels but acknowledge that this is a speculative microcap, and management hasn't done much to instill confidence.
    Aug 13, 2015. 10:27 AM | 2 Likes Like |Link to Comment
  • Sifting Through The Scraps In China's Steel Market [View article]
    wcapital, Thanks for reading and for the comment. You make a valid point regarding many of the small Chinese companies and the vaporization of shareholder value. To that point, AMCO shareholders didn't stand a chance over the past couple of years with all of the toxic financing and new share issuance. However, given that the CEO converted his working capital loan into stock at $1.50 per share recently and remains the largest shareholder of the company, it would seem that it is in his best interest to do what he can to enhance shareholder value from today's depressed prices. I think we should get some clarity in the next few weeks.
    Jul 21, 2015. 03:51 PM | Likes Like |Link to Comment
  • Diamond Hill Investment Group, Inc. Momentum Continues [View article]
    I estimate DHIL took in an additional $110 million in net new business during the month of June based on the firm's 8-K filed on July 2, 2015. I'm estimating second quarter EPS growth of better than 30%, with an estimate of $2.80 for the quarter, vs. last year's $2.12 in diluted EPS.
    Jul 7, 2015. 02:21 PM | 1 Like Like |Link to Comment
  • Diamond Hill Investment Group, Inc. Reports Results For First Quarter 2015 [View article]
    Better margins than I expected. We may see my price target of $200+ sooner than later.
    Apr 29, 2015. 04:28 PM | Likes Like |Link to Comment
  • That Was Quick! Our First Premium Author Hits $200,000 In Annual Revenue [View article]
    Congratulations on the successful launch, both to the participating authors and the Seeking Alpha team!
    Apr 21, 2015. 10:06 AM | 12 Likes Like |Link to Comment
  • G. Willi-Food: 10-Year History Of Management Decisions Suggests U.S. Expansion Likely A Pipe Dream [View article]
    I commend you for the detailed due diligence regarding the company's long history of trying to gain traction in the North American market. I had false hopes that Granovsky would be able to use his connections to strike a deal to expand in the U.S. during the past several months. With no deal announcements, soft Q4 results, currency headwinds, ongoing executive shuffling and drama, and a thorough takedown of management's past decisions, I can't help but wonder if sentiment will bottom in the very near future.
    Mar 27, 2015. 11:03 AM | Likes Like |Link to Comment
  • Costar Technologies, Inc.'s Transition To New Auditors Leaves Investors In The Dark [View article]
    If history is any indication, CSTI might release Q4 numbers on March 31st. The CohuHD acquisition continues to provide upside opportunity, but fundamentally, I became somewhat less enthusiastic about the story after figuring out that business with Wal-Mart is likely to slow going forward. Here's an excerpt from my last article in early November.
    Lastly, investors should be reminded that Wal-Mart Stores Inc. (NYSE:WMT) continues to be a major customer for CSTI, accounting for 51.8% of sales in the first half of 2014. This percentage will decline as a full quarter's sales with CohuHD are recorded, but it continues to be a very important relationship. It is my understanding that WMT is still finalizing its supplier agreements for the next two years. CSTI and its predecessor company have been working with WMT since 1991, but there is always a risk that WMT renegotiates terms with CSTI to be considerably less favorable and/or decides to work with a greater number of security camera suppliers. Additionally, WMT recently updated its capital spending plans, which now show a fairly steep decline in the expansion of WMT supercenters in fiscal 2016. Overall net retail square footage growth is expected to slow from 32-34 million square feet in the current fiscal year to a range of 26-30 million square feet for WMT's fiscal 2016 (1/31/16). This reduction, combined with WMT's emphasis on the smaller format stores vs. the larger supercenters will undoubtedly have a negative impact on the opportunity for CSTI to sell security systems to WMT. I now estimate CSTI's business with WMT could be down as much as 25% during WMT's fiscal 2016 vs. 2015.
    Mar 20, 2015. 08:31 AM | 1 Like Like |Link to Comment
  • RELM Wireless Protest Is Successful: Will The FBI Save Millions? [View article]
    A new 6.8% owner of RWC filed yesterday.
    The firm purchased nearly 1 million shares between 7/3/14 and 8/29/14 at an average purchase price of $3.91.
    Sep 4, 2014. 09:52 AM | Likes Like |Link to Comment
  • RELM Wireless, Motorola Solutions And The FBI Are Watching The GAO This Month [View article]
    Yes, I think this could turn into a significant event for RWC and others in the industry. If the FBI spends anywhere close to the $500 million over the next five years, and RWC is able to land even a smallish piece of the radio orders, the stock likely is a bargain at current prices. It also potentially opens the doors to other contracts where MSI had 100% of the business. I like my chances.
    Aug 25, 2014. 02:16 PM | Likes Like |Link to Comment
  • Let's Go To The Videotape: Costar May Have Hit A Homerun [View article]
    Diebold released second quarter results earlier this week. Management was upbeat about the electronic security results (where Costar is a supplier of video cameras). Revenue was up 15% during the quarter and is up 17% YTD. Additionally, DBD has hired an additional 35 new sales executives for the Electronic Security business, where bank branch remodels are a focus.

    I expect CSTI will release second quarter results in the next week or so. I continue to be very excited about the risk/reward for this microcap idea.
    Aug 7, 2014. 01:06 PM | Likes Like |Link to Comment
  • Costar Technologies Continues To Offer Significant Upside [View article]
    The recently closed acquisition of Cohu Inc.'s (COHU) video camera business should provide a nice boost to Costar's results in the coming quarters. COHU had video camera revenue of $15.7 million in 2013 and segment profit of $1.3 million, (less a modest amount of unallocated corporate expense). Costar has a 4% line of credit with the Bank of Texas, so investors can expect to see annual interest expense of $400,000 on the roughly $10 million cash purchase price. COHU's video camera business has not been consistently profitable in past years, but I see the potential for this acquisition to be nicely accretive to earnings, augmented further by the possibility of additional manufacturing cost savings and new revenue opportunities.
    Jun 23, 2014. 02:31 PM | 1 Like Like |Link to Comment
  • G. Willi-Food International, Ltd. News Creates A Buying Opportunity [View article]
    It's been two weeks since the Emblaze investment closed. No words from Emblaze yet, and I haven't heard anything about when Q1 results will be released. I think the ownership structure has WILC investors modestly concerned about the eventual relationship between Willi Food Holdings (WFLD) and WILC. I am hoping to hear from management in the near future.
    May 21, 2014. 01:40 PM | Likes Like |Link to Comment
  • Springtime In Florida: Things Are Heating Up For RELM Wireless Corp. [View article]
    Privet Fund Management LLC bought 63% of the 200,000 shares that traded over the past three days, increasing its stake in RWC to 16.6% from 15.7%.
    May 20, 2014. 11:00 PM | Likes Like |Link to Comment