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ENGlobal Corp. Message Board

  • panalta2000 panalta2000 Aug 31, 2013 5:34 PM Flag

    ENG is dirt cheap, debt free stock trading at liquid asset value:

    -$1.10 per share current assets and no debt
    -New $10 MM credit facility
    -Retains its most profitable segment with operations in Houston and Midwest
    -Historically traded as high as $14 when it was profitable
    -Small tightly held 23 MM float
    -Some of the smartest hedge funds like Renaissance hold stakes

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    • But should the mentioning that credit facility "will allow the Company additional time to analyze its long-term capital needs" raise any concerns? In latest 10Q company stated that it expects to have "working capital sufficient to conduct its remaining operations." What additional capital requirements does it see at this juncture?

      Also, since transaction details were not disclosed, does the $20M in total consideration compare favorably to the $18M in net proceeds anticipated in the 10Q, or does it represent a reduction in the previously announced total value of $21.5M? Don't s/h deserve to know if the company didn't get the $3.5 million promissory note for some reason?

      Company has taken some positive steps for sure, but doing anything more than holding existing shares is out of the question until the company shows a balance sheet reflecting final outcome of Furmanite deal, it comes through with at least two consecutive quarters of operating profit, demonstrates a sustainable growth trajectory, and/or management shows confidence in itself by buying company shares.

      Sentiment: Hold

      • 1 Reply to selllowtome
      • Total consideration of $20M for Furmanite deal compares with originally announced amount of $21.5M, with no explanation given for reduction. Of course this doesn't necessarily mean that ENG should also be valued at less than $1.5-$1.6 per sh, but one does have to wonder. Pro forma bv and tbv at $0.99 and $0.84, respectively, about what would be expected.

        ENG doesn't have a good track record meeting financial covenants. Last time around it seemed like it was in default before the ink on the amendment was dry. Hope they do better this time around.

        Sentiment: Hold

    • Just show me $6 a share and I will be a happy camper with some loss, not a very sad camper with big losses. Am still holding a bunch!

1.49+0.05(+3.47%)Aug 31 3:59 PMEDT