Important Updates for Investors
Carla Pasternak's Premiere Issue of High-Yield International Just
Released
Income expert Carla Pasternak's debut issue of High-Yield
International covers a Taiwanese manufacturer yielding 9.5%... a
rare Mexican monopoly yielding 13.4%... and other top-performing
investments yielding up to 19.0%.
Government's Biofuel Timetable Could Spell +15,900% Growth
+15,900% growth might seem far-fetched... but it's not. In fact, it
is mandated by law. And I've identified the ONLY stock positioned to
capture this growth.
The
Silver Lining to a Falling Dollar
Despite the U.S. national debt, there is a silver lining for income
investors. This massive spending, combined with movement out of U.S.
Treasuries, is going to take its toll on the dollar, and
international income investors could reap the rewards in the form of
higher dividends. |
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| Flamemaster
(FAME.PK) -- An Undiscovered Turnaround Stock with Tremendous
Potential |
Published: August 25, 2005
In my weekly premium
newsletter -- Undiscovered
Micro-Cap Gems -- my goal is to introduce readers to a variety of
promising micro-cap investing ideas that they may wish to consider for
their portfolios. In doing so, I generally look for small, neglected
companies that have been overlooked by conventional Wall Street sources.
I also look for undervalued firms that are trading at a steep discount
to their intrinsic value. Many of these individual investment ideas have
the potential to deliver triple-digit percentage gains in the years
ahead.
Below you'll find an
in-depth look at one such investing idea that I introduced my readers to
in a recent issue. To
gain access to dozens of similar investing ideas each and every week,
you'll need to subscribe to my Undiscovered
Micro-Cap Gems service. In the meantime, I sincerely hope you enjoy
today's sneak peak at one of my most recent micro-cap investing ideas...
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Flamemaster (FAME.PK, $5.10)
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Flamemaster
(FAME.PK)
Sector = Chemicals
Industry = Industrial Materials
Market Cap. = $6.4 million
Enterprise Value = $3.9 million
2004 Revenues = $5.0 million
2004 Gross Profit = $2.4 million
2004 Revenue Growth = -1.2%
Insider Ownership = 50.0%
Institutional Ownership = 0.0%
Insider Activity (ttm) = Neutral
Enterprise Value/EBITDA = N/A |
Flamemaster develops an array
of heat-resistant products that are used in the aerospace and defense
sectors. The company's flame retardant coatings are designed to stop the
spread of fires through electrical cables. Its specialized
heat-resistant coatings can withstand extreme temperatures and are used
to protect the surfaces of naval ships from the effects of missile
launches. Flamemaster also sells sealants for airplane fuel tanks and
pressurized compartments.
This is another stock that has been a victim of costly Sarbanes Oxley
regulations. In addition to the standard risks associated with the fact
that the company trades on the pink
sheets, Flamemaster also has issues concerning the concentration of
its customer base. Nevertheless, there is value hidden below the surface
here.
For starters, the stock is controlled by a diverse group of insiders who
should have incentive to see the shares appreciate. Although the firm's
recent financial results have been unimpressive, company revenues have
climbed +4.1% in the year-to-date period to reach $3.7 million. One-time
expenses stemming from a failed merger have contributed to a modest
decrease in net income, but the firm's bottom line remains solidly
positive. It is also worth pointing out that the company has reliably
distributed 63 consecutive quarterly dividend payments, which reflects
an ability to generate consistent cash flows in any economic cycle.
Currently, the shares are trading at a reasonable Price/Book ratio of
1.5, well below the industry norm of 3.7. FAME is also trading at
attractive Enterprise Value/Sales and Enterprise Value/Gross Profit
multiples of 0.8 and 1.7, respectively. Furthermore, the firm's balance
sheet is in excellent shape. Flamemaster has nearly $1 million in cash
on the books with no debt, and maintains a healthy current ratio in
excess of 14.
Barring the unexpected loss of a major customer or a sudden
deterioration of operating conditions, Flamemaster's underlying value
should eventually be reflected in its share price. In the meantime, the
attractive 2.6% dividend yield provides ample incentive to wait for a
turnaround. I wouldn't recommend jumping into this relatively illiquid
stock without performing additional due diligence, but patient investors
should ultimately find FAME rewarding.
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Important Note: The above article
was merely a small excerpt from a recent issue we sent to subscribers of
our premium value investing service -- Margin-of-Safety
Investing. In each issue of that newsletter, editors Nathan
Slaughter and Paul Tracy deliver an in-depth look at a variety of other deeply discounted
stocks that should provide investors with a solid margin of safety at
current prices. To receive your copy of our most recent issue of Margin-of-Safety
Investing, as well as other guidance similar to this twice per
month, you'll need to subscribe to this publication. To learn more,
please visit:
https://www.streetauthority.com/subscribe-msi.asp
Thanks for reading!
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Nathan Slaughter
Editor
Half-Priced Stocks, The ETF Authority
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| To receive
in-depth guidance on today's leading value opportunities, plus educational guidance, please subscribe to
Nathan Slaughter's premium value investing newsletter --
Half-Priced
Stocks |
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Investing Doesn't Get Any Easier Than This |
Stock picker Amy
Calistri's strategy is as simple as investing gets -- just one idea
a month designed to make money in today's market. Invest this way
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