Oil & gas companies are facing ultra depressed prices. Also, most of them carry a large debt burden. Who's to say that prices will recover before a lot of these companies go out of business, even some of the big players in the business?
One might be skeptical that a whole industry sector could go belly up. But consider the airlines. In the past, the airlines would pretty much all go bankrupt periodically.
Hard to show good results when your business involves selling a commodity product whose price has fallen into the dumpster.
MTSN at highs, UTEK at lows. This is one factor that points toward UTEK being the better value of the two right now. Past performance is no predictor of future results.
I'm not familiar with this company, but it would seem that the key issue is:
Do these guys have some sort of competitive edge that gives them a leg up in competing in what sounds like a business area with promising growth prospects? Or is their appeal simply that they have thrown their hat in the ring in a promising arena that has generated a lot of hype, even though they don't necessarily have anything better to offer in that area than what other companies could offer?
On the other hand, I just had a heat pump installed in my home in the Portland, OR area and my natural gas useage will probably go down about 90% from what it was in prior years.
I must admit, though, part of their current success is that their production happens to serve the west coast market that commands higher spot prices.
Haven't read the quarterly yet, but I can't imagine the good results aren't heavily influenced by beneficial hedges, which aren't going to be something natgas producers are going to be able to rely on down the road if spot prices remain in the dumpster.
This is a dilemma stock. A decent value, but not a screaming value. To buy or not to buy, that is the question? For me it is just not quite cheap enough. If for some reason it went down further, I would most likely buy some.
If I read their news release correctly, they got 100% participation for their buyout auction. If CAD is 0.80 times USD then they are buying back the shares at 3.68 US. A couple cents above the closing on Friday. Must be more than a coincidence. It appears the market is now valuing EXFO shares at very close to the price that they bought back shares at.
Yes indeed. $30 mil CAD is only about $24 mil USD. Their cash and short terms in their last quarterly added up to about 57 mil if I read correctly. So after this buyback they will be donw to 30 mil or so net cash on the balance sheet. That should be plenty for a company their size. I wouldn't want to see them letting it drop much below that, however.
I really ought to own a bit more of this stock. Probably will buy a couple k more shares even though it's 4% more expensive based on today's rise. Wonder if today's gain has to do with the buyback.
From the zacks article:
It commonly happens in stock investing that investors miss the chance of buying winning stocks that they knew would stand out. Before they take the plunge, others get to know the hidden potential and enter into these stocks, pushing them out of reach.
Indeed, I often become aware of a stock only to discover that if I had known about it a few months before it would have shown numbers that would have led me to conclude it was a good value and I would have bought the stock. But when I do discover the stock it has gone up maybe 20-30% and is not nearly as compelling a value, so I either pass on it or else buy less than I would have earlier, based on my view that it is still a good buy but not like it would have been months earlier.
Jim Cramer is a master of recommending stocks AFTER they have already gone up a bunch. I see this a lot in Barrons too. I look at the graph of a company they tout and it shows them like let's say a stock price of 60 today while they were 30 a half year ago. And my feeling is, WHY DIDN"T YOU TELL ME ABOUT THIS STOCK 6 MONTHS AGO?
So what about EXFO. I do not know whether it will go up a bunch. But what I do know its numbers meet my criteria for what I consider to be a deep value stock. Because it is a small company I feel it is a bit riskier than my other stocks and I don't have as much invested in it. Perhaps I should get a bit more.
Bottom line, if this company does well business wise going forward, the stock ought to be way higher.
If true that is great, means EXFO is buying back shares with cheaper Canadian dollars. In which case, their net cash position as shown on Yahoo statistics and on Exfo's quarterly statements will not be depleted quite as much as it would if those share prices were in US dollars.
Sold 1/4 of my shares. Still very bullish on RTEC, but it has gone up quite a bit, so it is not quite as great a bargain as before and it seems like a good time to lock in a bit of profits.
Just became aware of Camtek due to their suing the company that I own some stock of.
Actually looks like a good value stock. They ought to forget about the vendetta and concentrate on their business, though.
Also, a company with revenue around 100 mil is an awfully small player in this market. It seems like they will inevitably get bought out. I guess since they are the plaintiff in the legal matter it won't be viewed as a liability for a potential buyer of Camtek, except insofar as it siphons money for legal fees that ought to be used for the busienss. But a buyer can fire the lawyers as soon as the acquisition is completed.
So I am bullish on Camtek and will probably buy some shares today.
ACLS is now emerging as the upstart in the implanter business that has the leading edge product line, compared to the old dowdy offerings from the company that has dominated the business.
It is hard to imagine that the company with the most advance semiconductor process technology, Intel, will want to remain completely dependent on the "old guard" vendor as its source for implanters.
That has got to obviously be ACLS's hope when it states the goal of selling a machine to a major in the foundry logic segment of semiconductors.
I think they will get in the door at Intel as a supplier of implanters. When Intel buys its first ACLS machine, it should be a nice up blip for ACLS stock.