5/22/2010

Business partnerships at favorable terms

This goal may be achieved by investing in statistically cheap stocks with wide diversification. I believe Ben Graham embraced this approach.

To start the search I used the following rules to help measure a way to find opportunistic prices.


1)(Cash +AR – Total liabilities)/Price >50%
2) Share count from 2004 to 2009/TTM >1 representing a reduction of share count or stability
3)Positive EBITDA and CFFO for the trailing 12 months
4)Market capitalization from 19 to 189 million
5)Reducing debt from 2007 to TTM

The 6 ideas that were uncovered offer potential for different reasons but they do share the above 5 listed criteria.

Symbol: MTXX
(Cash +AR-Total Liabilities )/Price = 104.74%
Price:$ 4.43
EV: $2.49
Industry: Drug Delivery
Name: Matrixx Initiatives,
Market Cap = 44 million
Enterprise Value = 23 million
(Cash + AR – Total liabilities)/Price =98.33%
FCF/EV = 42.57%
Cash/Price = 74.73%
One year return -70%
Stable share count

Symbol:RVSN
Industry: Processing Systems & Products
Name: RADVISION Ltd
(Cash +AR-Total Liabilities )/Price = 85.39%
Price:$ 5.86
RV: $3.74
FCF/EV = 10.16
3 year annualized return -33.90%
Stable share count
Share buybacks

PARL has the attributes of a real turnaround supported by deep value.

Please click to view more information and other selected ideas.

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