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Alloy Steel International, Inc. Message Board

chris_cs16 2 posts  |  Last Activity: Feb 10, 2016 12:41 PM Member since: Aug 21, 2001
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    anybody know why the ER is late??????

    by williamszxz Nov 25, 2015 3:18 PM
    chris_cs16 chris_cs16 Nov 25, 2015 10:25 PM Flag

    Fiscal year-end ER will come in mid-December, just like last year (December 19). The fourth quarter / full year financials take longer as they're audited.

  • chris_cs16 by chris_cs16 Feb 10, 2016 12:41 PM Flag

    RUBI is significantly undervalued in the low $12's. The company will report earnings near the end of the month and I expect them to beat estimates and their own guidance handily. They have a history of under promising and over delivering. EBITDA guidance for the fourth quarter is $20 million, I expect them to come in closer to $25-$26 million of EBITDA, meaning full year EBITDA in the range of $48 - $50 million. Cash should increase to close to $140 - $145 million, meaning at current share prices, the company is valued at 8x trailing EBITDA.

    The company has set EBITDA guidance for 2016 at $45 million - $60 million. Keep in mind they initially set 2015 EBITDA guidance at $20 million, and they're coming in at more than double that amount. I would expect the company to raise its 2016 guidance when they release earnings in late February, and then continually throughout the year, similar to 2015. I would estimate 2016 EBITDA of close to $80 million, meaning they are trading at less than 5x 2016 EBITDA! Please find me another company that is growing at 30% - 40% per year trading at 8x trailing EBITDA and 5x forward EBITDA.

    Fair value is above $20. The company traded over $20 per share after last year's earnings release, and performance has more than doubled since that time. How this is trading at half the price, with double the performance is puzzling. The upside at $12 is 50% - 100%, while the downside is 10%. This is an easy trade and I'm loaded up with shares and options (March 12.5 and 15 calls). Look at CRTO, in the same space, announced earnings and they are up 20%+. I would expect something similar or greater with RUBI on earnings day.

    Sentiment: Strong Buy

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