I hold a similar amount of shares.
As I see it, under normal circumstances the stock will trade at a discount as long as the majority shareholders have more than 50%. They control the vote.
It would be interesting to know if Mr. Kunin's Federal Estate valued its interest at a premium because of its majority interest......
Even If there was a proxy contest at some point, I am not certain how friendly the laws of Minnesota are to minority shareholders.
I like your analysis. How did you arrive at the $17 million for real estate?
the 22 million in equity lists the property at 10 million. The property is worth at least 15 million, maybe 18. So up the equity by 5 million, and you have 27 million in equity or 10 dollars a share, and probably closer to 12.
I looked at the DEF14A and no one listed there is higher other than the Kunins. I have picked up all my shares under 6. The 333,000 sq. feet of real estate is worth at least 17 million, and the company could get to 130 million dollars a year in sales, which would translate, even at meager margins without incentives to sales and cutting CIC deal, 50 cents a share. So, taking out the debt by collecting faster (note to CFO), the book value is at least 8 dollars a share, and if the Kunins get through dealing with esate taxes (they just sold art for over 40 million bucks so NSYS is completely safe from any kind of Icahn stealing it), they will install a more proactive team and this is a 12 dollar stock, most likely in 2-3 trading days once first q is announced..
I am the largest non-kunin shareholder. I have over 48,000 shares and I think this is what needs to be done:
First, sell off the defense business - take it private, whatever it takes, but stop feeding it. As noted below, if you just give one of the buildings in the mix, someone would take it subject to part of the credit line.
Second, change the company's name to WLSI - Wayzata Life Science & Industrial - this is where the $$$ is. Medical devices are the new cold war and industrial in america is coming back because all the low iq areas out of US cannot compete with complex assemblies, it has to be made here. This is especially the case for medical devices.
Third, start changing the compensation structure to stop the CIC deals - it is too generous. The sales staff should be give much larger bonuses. The CFO should be instructed to get receivables down to get more cash in - debt should be paid down.
Fourth, start publicizing the fact that the balance sheet is beyond strong - the company owns 333,000 square feet of space - office and industrial. if that is worth 50 dollars a square, then that asset alone is worth $17,000,000 - all the property is stated at book at around 10,000,000 - there is fully $4 per share in property that is sitting there not being put to highest and best use. As noted above, defense should not be allowed to continue occupying space that could be used for medical. Sell or give a building or two up to get rid of defense - this guy in the white house is a pacifist there aint gonna be another war for a few years.
So, there you have it, the assets of the company are understated by 5 bucks a share at least so true book is closer to 13 bucks a share. the company can get higher margins by getting rid of defense. Sales persons need to be paid. Cash needs to be collected to pay off that wells fargo line.
The kunins do not seem to be against this process - lord knows they have the money to back this process
I am the guy w 7,000 shares who asked the questions. I am tired of the answer that it's a long term play from ceo. That's nice for him to decide its a long term story while he collects a nice salary, bonus and benefits. Us shareholder get nothing but #$%$ stories. 100 million in revenue and not even 1 % falls to bottom line. Seriously?
a guy who owns 7000 shares asked the best question - which sales are high margin - that is the medical. the country is a country of geezers and if you think the war budgets were big, you have not seen big budgets at all. The growth in medical sales means that this company will do 120 million in revenues in 2015. they will bring 1.0% to the bottom line, or about 1.2 million in net income, which would mean about 45 cents.
That is why the kunins are holding this and selling all of myron's art to pay taxes. they know that with degen gone and a more reasonable compensation deal for the wasieletatiaki guy, they can have this stock double and be available to pay taxes when mom dies.
if you are selling now, you do not understand much.