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  • Autoinfo's Takeover Severely Undervalues The Company 0 comments
    Mar 1, 2013 4:27 PM | about stocks: AUTO

    AUTO, through its wholly-owned subsidiary Sunteck Transportation, is a non-asset based truck-brokerage operating in the United States and Canada. To keep things simple, this is a fantastic compounder and an amazing FCF generator.

    A few articles listed below cover the ground rules for the company:

    Overview and Comps

    Discussion of the Takeover - HeresyValue

    Discussion of the Takeover - OTCAdventures

    For a quick summary, the company is getting bought out at roughly 8 times earnings, which generally equals FCF. The business is extremely resilient:

     

     

     

    2007

    2008

    2009

    2010

    2011

    3Qs 2012 (Sep 30)

    Op Income

    2,947,000

    4,195,000

    2,828,000

    5,676,000

    6,432,000

    5,646,000

    Net Income

    1,604,000

    2,224,000

    1,418,000

    3,055,000

    3,638,000

    3,305,000

    Book Value

    13,816,000

    16,309,000

    17,924,000

    21,107,000

    24,892,000

    28,253,000

    There are also several large value investors holding stock in the company (covered in HeresyValue) and evidently many smaller value investors holding positions in the stock.

    The business could easily be worth double the take-out price to a competitor, if not more. Standalone, the business is already worth more than the take-out price.

    Stocks: AUTO
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