I looked at ALN and would pass on it because it does not meet my screen and I know nothing about business which would cause me to pursue it. This does not mean it is not a good investment.
In its favor, Gabelli is buying but not in size: Gabelli Equity Trust added 10,000 shares in 3Q to bring to 110,000 shares.
The BV is about 9.20, not much progress since 5.37 in 1983 with little or no dividend. Major change in profile with spin-off of auto parts business in 1995. Very little progress since then with BV 9.55 in '97 and 9.10 in '98. This is well short of double digit momentum I am seeking.
Of 6 analysts following 4 are hold (means sell). Projecting 12.5% growth in EPS but Valueline projecting only 8.5% with $1 EPS in 3-5 years.
On this basis I would not pay BV. Current price of 9.50 slightly above BV. In early 1999 price fell to 4.50 or about 50% of BV. Therefore, if I were interested it would be at 50% of BV or 4.50 because this is the benchmark low for this company. Further, with single digit average projected ROE it appears that a substantial discount from BV is necessary to achieve a bargain purchase.