The analysis in that recent article appears to me to be seriously flawed and based upon a complete misunderstanding of what NPK has done.
1. NPK is allowed to horde cash, it just can't put the cash in certain investment vehicles. IIRC, money market funds are OK.
2. Even before the court decision, NPK had shifted substantial assets into funds that are OK according to the SEC. In otherwords, the snapshot picture of NPK as an investment company based upon where it had its assets in 2002 is very different than the snapshot taken in Nov. 2005.
3. The article's conclusion that it was the SEC that motivated NPK to get into munitions is not supported by any evidence. NPK always said it would acquire when the market was right; and NPK used to be defense mfg, so getting into munitions made a lot of sense. Which is more likely: That NPK invested because of the SEC or because of the "opportunity" [I mean that strictly in an investing sense] created by the Iraq war.
4. If NPK has shifted its cash into appropriate funds, then de-registering as an investment company is a completely logical decision and is in no way a thumbing of its nose at authority.
Caveat: I'm not certain that NPK has shifted the appropriate percentage of funds, and I haven't read all of the 10K stuff it's filed, but I do know that they shifted a good bit.
I'll take the market's assessement of NPK's value ($15 increase in a couple of weeks) over some fool's, any day of the week.
Anyone know of a way to submit guest editorials to Motely Fool?
I agree with you. The article is stupid. Even if NPK gets delisted, who cares? You still own the same company. The stock isn't very liquid anyway, if you couldn't trade it for a short time, or if it moved to the BB or Pink sheets, who cares. There business isn't changing over the next few months or longer. Numbers will continue to be strong over the next several years.
That being said, I'm not sure why they are a public company. They rarely communicate with investors, and when they do the detail isn't great. They could either pay out a large cash dividend to get in compliance or go private. Mary Jo and Co should buy back the 65% of stock they don't own, lever the BS a little and tell the SEC to F off.
I hope they get delisted and the stock falls 20 points so I can double my position.