Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

UFP Technologies, Inc. (Nasdaq: UFPT) - A small cap worth a look.

|Includes: UFP Technologies, Inc. (UFPT)
UFP Technologies Inc. (Nasdaq:  UFPT)
172 East Main Street  Georgetown, MA 01833  
Phone: 978-352-2200  
Fax: 978-352-5616  
Web Site:

Index Membership: N/A
Sector: Consumer Goods
Industry: Packaging & Containers
Full Time Employees: 586

UFP Technologies, Inc., through its subsidiaries, engages in the design and manufacture of engineered packaging solutions for automotive, computer and electronics, medical, aerospace and defense, industrial, and consumer markets. The company offers packaging products primarily using polyethylene, polyurethane, cross-linked polyethylene foams, and rigid plastics. Its packaging products include end-cap packs for computers, corner blocks for telecommunications consoles, anti-static foam packs for printed circuit boards, die-cut or routed inserts for attache cases, and plastic trays for medical devices and components. The company also fabricates and molds component products made from cross-linked polyethylene foam and other materials, as well as engages in laminating fabrics and other materials to cross-linked polyethylene foams, polyurethane foams, and other substrates. Its component products include automotive interior trim, athletic and industrial safety belts, components for medical diagnostic equipment, nail files and various beauty aids, anti-fatigue mats, and shock absorbing inserts used in athletic and leisure footwear. The company was founded in 1963 and is headquartered in Georgetown, Massachusetts.

1.  Fundamentals -  We believe the company has done a nice job managing the economic down turn and is beginning to experience improved visibility.  The "pick and shovel" type business they run attracts us, as does the client list, and shares may appear attractive to value buyers.  Snapshot highlights; 
- Market Cap:  $38.5MM
- P/E (ttm): 9.75
- P/S (ttm):   0.45
- P/B:  1.10
- Cash:   $11.9MM
- Debt:  $8.3MM
Fundamental Snapshot link:
Historical number link (annual):
Historical number link (quarterly):
Forward growth prospect link:  

2.  Insider Buying - They're small purchase, but corporate insiders have reported recent purchase, with no matching sales, at prices between $5.37 and $5.84.
Insider buying link:

3.  Selective & Opportunistic Execution of Acquisitions - We believe in and like companies that are targeted, patient, selective and opportunistic when they move on buying up all or part of a competitor or complimentary product line.  UFPT appears to execute and manage integration very well.  We like their recent purchase of assets from a competitor out of bankruptcy.
Recent purchase link:

4.  Tight Capitalization Structure - Issued & Outstanding Shares:  5.9MM.  Publicly Traded Float Shares:  5.1MM
Verification for these numbers are found in the Fundamental Snapshot link noted in #1 above.

5.  Increased Exposure - Although analysts haven't clamored to the name, this company is starting to show up on many folks value based screens.  Increasingly, and when asking generally, our Wall Street contacts know of the name and, while most have no position, they're warming to the story as they complete due diligence in the name.  Sure, we'd like to see a few more boutique investment banks, research and analytic firms and/or regional broker dealer analysts cover the company, but we're happier to get in ahead of them, set up our trade, and let them find us.  At this point, the only report we've reviewed is a paid Taglich piece, where the obvious conflict of "analyst takes a paycheck" vs. "analyst offers unbiased research" reduces credibility, not to mention the poor historical statistics on performance when evaluating this firm.  Nevertheless, the content and corporate information in the report, though all publicly available and I'm no Taglich fan, is well done.
Taglich Brothers research report update from June 2009 link:

UFP Technologies, Inc., offers packaging solutions for automotive, computer and electronics, medical, aerospace and defense, industrial, and consumer markets.  While it's not the most exciting story, this company brings substance to the table, in the form of it's exceptional management and historical fundamental performance.  We're inclined to believe, in a choppy market, this company will substantially improve it's top and bottom line growth performance in 2010, fueled by great management overseeing organic and acquisition initiatives.  The insider buying, though not sizable, provides us some visibility with regard to selecting a floor on the stock, and we believe within a 6 month period an analyst from a broker dealer, boutique investment bank or research and analytics firm will pick up coverage on the name.  Building on a thesis founded on fundamentals, and finding comfort in a few insiders putting money to work in their own name, it's our belief the name is and will attract more exposure with continued operational performance and that shares could see a noticeable pick up in liquidity and valuation fueled by the tight capitalization structure.  It is our belief the stock is a BUY for traders and investors alike.
Legacy is not registered investment adviser, nor a licensed broker/dealer which publishes research reports with respect to securities that it follows and / or trades in. This report has been produced for information purposes only and Legacy was not compensated for it's production.  The information contained herein is based upon sources which we believe to be reliable, but no representation, express or implied, is made with respect to the accuracy, completeness or reliability of the information or opinions in this and / or the reports mentioned herein. The information contained herein is subject to change without notice, and we assume no responsibility to update the information in our reports and no contractual commitment is formed simply by using the web site. Legacy does not accept responsibility or liability for any direct, indirect, special, consequential or other losses or damages of whatsoever kind arising out of access to, or the use of this report or any information contained in it.

We, our affiliates, and any officer, director or stockholder or any member of their families may have a position in and may from time to time purchase or sell any securities discussed in our reports, however, we maintain no position in the equity discussed at the time is this reports issuance.  An employee, analyst, officer, or a director of the firm, or its affiliates, may serve as a director for companies mentioned in our reports. There may be instances when fundamental, technical, and quantitative opinions may not be in concert. This firm (or one of its affiliates) may from time to time perform investment banking or other services for, or solicit investment banking or other business from, any company mentioned on this web site. Reports on companies which are published pay a monthly fee for the creation and dissemination of research reports. Some of the companies pay an initial retainer and details of compensation from such companies are contained in the disclaimer of each report.

The information on this site is for information purposes only and is not intended to provide tax, legal or investment advice.  Legacy makes no representation, assurance or otherwise that the purchase of securities of companies profiled in this report is suitable or advisable for any person, or that an investment in such securities will be profitable. In general, given the nature of the companies profiled and the lack of an active trading market for their securities, investing in such securities is highly speculative and carries a high degree of risk.  You should not rely on material contained this and / or any other reports mentioned herein and should seek independent advice wherever necessary. Any decisions you make based upon any information contained in this and/or other reports mentioned herein are your sole responsibility. The information does not constitute a solicitation of any order to buy or sell any securities. The information provided herein may be displayed and printed for your personal, noncommercial use only. You may not reproduce, retransmit, distribute, disseminate, sell, publish, broadcast or circulate the information to anyone, without the express written consent of Legacy.