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Fama and French proved out that Asset Allocation accounts for 96% of typical investment returns. I need to constantly remind myself that it is about asset allocation, not individual company picks. Buffett is an asset allocator, not just a stock picker. I have decided to pursue the Magic Formula... More
  • (CIMT) Is A Great Value, Strength And Growth Stock 0 comments
    Jan 30, 2013 4:03 AM | about stocks: CIMT

    I started with the standard micro magic, mechanical screening metrics to get down to a handful to review.

    Buffett wants something undervalued, so I screen PE<15 and PS<3. That gets the Finviz population down to 988.

    Next, I want Greenblatt happy by getting something performing with the assets it has. ROA>10% and ROE>5% gets down to 248 stocks.

    Graham would want financial strength. So LTD to Equity <.01 and Current ratio >1.5. That gets us down to 129 stocks.

    O'neil would want canslim with solid growth. 5 yr sales growth >10% with 5 yr EPS growth >30% should help prove that out. Price >$2 to avoid penny stocks. That gets us down to 14 candidates.

     

     

    o.TickerCompanySectorIndustryCountryMarket CapP/EPriceChangeVolume
    1CIMTCimatron Ltd.TechnologyTechnical & System SoftwareIsrael68.08M4.857.320.00%432,704
    2CVUCPI Aerostructures Inc.Industrial GoodsAerospace/Defense Products & ServicesUSA92.52M8.3311.080.27%18,658
    3POZNPOZEN Inc.HealthcareDrug Manufacturers - OtherUSA163.37M3.855.390.56%67,039
    4SKULSkullcandy, Inc.Industrial GoodsIndustrial Electrical EquipmentUSA190.58M7.136.920.87%417,398
    5CXDCChina XD Plastics Company Ltd.Consumer GoodsRubber & PlasticsChina200.70M3.084.220.00%15,862
    6YONGYongye International, Inc.Basic MaterialsAgricultural ChemicalsChina282.52M4.585.59-1.41%125,442
    7PWERPower-One Inc.TechnologyDiversified ElectronicsUSA477.34M5.873.931.55%1,496,444
    8HITKHi Tech Pharmacal Co. Inc.HealthcareDrugs - GenericUSA500.33M14.2937.451.11%64,089
    9BPIBridgepoint Education, Inc.ServicesEducation & Training ServicesUSA560.96M4.3110.39-3.44%166,680
    10KLICKulicke & Soffa Industries Inc.TechnologySemiconductor Equipment & MaterialsUSA884.09M5.5611.78-8.33%4,144,687
    11DECKDeckers Outdoor Corp.Consumer GoodsTextile - Apparel Footwear & AccessoriesUSA1.42B10.0240.38-3.05%1,384,314
    12CRUSCirrus Logic Inc.TechnologySemiconductor - SpecializedUSA1.83B12.1028.43-1.49%2,059,043
    13MOSThe Mosaic CompanyBasic MaterialsAgricultural ChemicalsUSA26.40B14.3962.01-0.56%2,416,224
    14AAPLApple Inc.TechnologyPersonal ComputersUSA430.34B10.39458.271.88%20,334,276

    Next, I looked for moat, potential for growth, having financials reported somewhere other than China, avoiding banks and drug cos.

    Just for an aside, my biggest holding is still solidly on the list . . . AAPL. If someone finds a value/strength/growth stock with such a strong moat, let me know. If I wasn't overweight AAPL, I'd get more.

    The candidate that comes in next for me is the smallest market cap. CIMT. Here is a solid, cash rich company growing in CAD/CAM and has been referenced all over the boards related to 3D printing.

    So let's make sure we aren't missing something. Why is this stock so cheap and do we expect it to grow for us in the future.

    One knock against it is that it is Israeli based instead of US based. My research says that Israel follows international GAAP or IFRS. I also see plenty of Israeli tech start ups later purchased by the likes of Paypal, 3M. I won't put it in with China for financial reporting.

    Another knock is that it has only been over $50M market cap for 2 weeks after a recent runup. It falls below scope for most professional money managers.

    It is reasonably illiquid, so buying in without a level two screen might get you fleeced. Careful on the way in. Also, I wouldn't suggest any trailing safety stops. Any big elephants jumping in the tub will create quite a bit of volitility.

    CIMT is a solid company from "the numbers". If you want to know its products, competitors, etc. please look elsewhere. I prefer to just make an objective assessment.

    If anyone sees a better candidate up there on the list, feel free to let me know.

    MM

    Disclosure: I am long CIMT, AAPL. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

    Themes: long-ideas Stocks: CIMT
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  • been trying to find another AAPL. Financial Strength, Value metrics, Sales and EPS growth over years. Found it - $CIMT, volitile yes
    Jan 31, 2013
  • Generating $20B/qtr in FCF, $AAPL will have more cash than it's mkt cap in less than 3 years. If it wasn't so big, Buffett would buy it.
    Jan 23, 2013
  • $AAPL Read 33s instablog. Exactly the kind of article that SA won't publish Too financial. Tomorrow will be a media driven bloodbath.
    Jan 23, 2013
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