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Ballantyne Strong, Inc Message Board

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  • jpomper jpomper Dec 25, 2011 8:40 AM Flag

    Great News...why did it take so long?

    You seem to have long experience here.
    I have some questions, as I am new here, BTN just popped up on my "value" screen.

    Do you think my conclusions on BTN fundamentals can be summarised as follows?

    -BTN has $25M cash in the bank
    -if we deduct from the $52M market cap the $25M cash, then the company working capital is cca. 27M,
    -and this money is in a $12M plant and cca. $15M inventory
    -last year BTN made cca. $10M earnings, so the real operating PE is closer to 2.5 ratio
    -BTN has nice order book for 2012
    -next year estimates are at $0.80/share earnings
    -and they initiated buyback program now for $8M?

    What is wrong here?

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    • Hi,

      Your numbers mentioned look on target and your questions are all good ones.
      I have held this stock on and off over the past few years. I still own some but had decreased my bet awhile ago as I find their management team in general, way too slow in addressing shareholder concerns. Good thing these guys didn't work for me. They would have been gone already.

      I'm no valuation expert but IMHO I would reasonably expect this stock to be more accurately valued at least $8.00 a share...essentially a double from current pricing. Their buy back announcement should help keep a nice floor under it for a good while. Hopefully they actually will use the full $8 Million.

      • 2 Replies to rjschwartz7yankees
      • well if your so f-cuking smart
        why dont you just buy out the company
        and resolve the matters, dork.

      • Thank you, rj, for your opinion,

        1) I just realized that since the buyback anouncement the daily volume jumped 50%, and the price jumped 20% in 1 week, on a total volume of 0.5M shares.

        2) if we assume that half of the volume jump is from BTN BUY orders (the other half from momentum investors), I estimate they had spent cca. 10-12% of the $8M buyback money in one week.

        3)If this dinamic buyback system would be linear (it is NOT !), we could conclude from this 1 week experience, and initial condition of BTN still has $7M buyback firepower, an outlook as follows:

        4)If 1 week and $1M made 20% price jump,
        then a neg.exp. curve extrapolation, with $7M and 7 weeks final parameters, that the system would yield 70-80% further price increase.

        So, rj,
        your fair value estimate of $8 might be not far from the resulting final calculated price by the end of febr 2012.

        Hold on, even add more, on any price weakness until then.

        Best regards, JP

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