I too think we are in baragin territory. They hold approx $1.75 a share in cash, have cash flowed $50 million a year for the last 2 years, have a lot of number one products for the upcoming back to school/xmas seasons. The PE multiple sits close to 7. I'm perplexed. I'm hoping for a short term sell off in the market with the near term Syria conflict. I'm looking at middle $9 range and then will hold until next years for the results.
It's true that the PE multiple is around 7 but the forward PE is higher. It's more like 16-18. That's because there is non-recurring revenue and tax benefit items that won't happen in the future. I agree that it is priced in "value" territory but it is not as cheap as indicated by the PE of 7.
The normalized earnings were about $.56 and not $1.25.
JC I am at a loss about this stock. Heavy shorts but on paper a tremendous company. It should be much higher. I have been in for about 14 months and trades in such a tight range it is becoming very boring. Everything you say is true but look at the history...sad