This tiny very well managed closely held company surely merits a much closer look. DIT improvements have yet to be fully reflected in the market value. Over time operations have significantly improved and they simultaneously increased cash, reduced debt and share count. The enterprise value to sales, book value, GP have all greatly improved.
DIT: AMCON Distributing Co is engaged in the wholesale distribution of consumer products such as tobacco products, candy, beverages, food service, groceries, paper products, automotive and health and beauty care products. In addition, the Company operates fourteen retail health food stores in Florida and the Midwest.
Based on their performance over several years clearly demonstrates these managers/owners understand value creation. In the latest annual letter to shareholders management has strategic objectives that focus on the operational benefits of a strong balance sheet.
From the 2011 letter; "short term our strategic objective is to maximize balance sheet liquidity We believe this balance sheet liquidity enhances our ability to take advantage of both merchandising and strategic opportunities. One of the critical elements of executing an acquisition strategy is to have the financial wherewithal to close the transaction in a condensed time frame. Moreover, having readily available financial resources enables our management to put more time and resources into actually evaluating and organizing the closing, as well as the integration of the newly acquired business."
"Our focus on liquidity also provides the flexibility to best position AMCON to develop merchandising opportunities that will directly impact our Customers’ bottom line profits. We work closely with highly respected consumer product companies to develop these promotional opportunities. The capital requirements to facilitate these programs are large and need to be implemented on short notice. Hence, keeping plenty of dry powder is a critical element of this strategy."
In the medium term, we seek to generate free cash flow which we can use to reduce debt. We established this objective as a medium term goal because we frequently leverage our credit facility as a profit enhancement tool. Thus, on a short term basis, borrowings on the credit facility may increase as opportunities manifest themselves. However, over time, through profits, we seek to reduce the total amount of debt outstanding. Similarly, we seek acquisitions or may open new stores, which will require cash. We were especially proud of our debt management performance
We focus on return on assets and capital employed from a financial perspective as we believe this is an appropriate way to manage our business for long term capital appreciation.
Frequently shareholders inquire as to our philosophy with respect to share repurchase. Our view is that we examine ,and rank, all of our various opportunities whether they are acquisitions, inventory purchases, capital expenditures, share or debt repurchases. When a share or debt repurchase is the highest and best use of our cash, we will not hesitate to act on it. This, again, is why our short term strategic plan is to maintain liquidity. With liquidity comes the ability to execute on any or all of these options."
| DIT: | |||||
| 2008 Yr End | Current | Change | Change % | ||
| Market Price | $23.48 | $63.10 | $39.62 | 168.74% | |
| Cash | 457,681 | 1,389,665 | 931,984 | 203.63% | |
| Liabilties | 82,340,164 | 65,727,040 | -16,613,124 | -20.18% | |
| Book Value | 10,965,194 | 41,708,593 | 30,743,399 | 280.37% | |
| Revenue | 860,451,122 | 1,080,237,781 | 219,786,659 | 20.54% | |
| Gross Profit | 64,676,342 | 75,193,995 | 10,517,653 | 16.26% | |
| SGA | 51,631,324 | 58,037,243 | 6,405,919 | 12.41% | |
| Float | 391,090 | ||||
| Shares Outstanding | 851,298 | 778,914 | -72,384 | -8.50% | |
| Market Cap | 19,988,477 | 49,149,473 | 29,160,996 | 145.89% | |
| EV (MC-Cash+Liab) | 101,870,960 | 113,486,848 | 11,615,888 | 11.40% | little chng in EV |
| Price | 23.48 | 63.10 | 39.62 | 168.74% | |
| EV Per Share | 119.67 | 145.70 | 26.03 | 21.75% | small EV chng |
| Sales Per Share | 1010.75 | 1386.85 | 376.10 | 37.21% | Positive |
| GP Per Share | 75.97 | 96.54 | 20.56 | 27.06% | Positive |
| SGA Per Share | 60.65 | 74.51 | 13.86 | 22.85% | |
| BV Per Share | 12.88 | 53.55 | 40.67 | 315.76% | Positive |
| EV/MC | 5.10 | 2.31 | -2.79 | -54.71% | Positive |
| EV/BV | 9.29 | 2.72 | -6.57 | -70.72% | Positive Improvement |
| EV/Sales | 0.12 | 0.11 | -0.01 | -8.33% | Positive Improvement |
| EV/GP | 1.58 | 1.51 | -0.07 | -4.43% | |
| GM % | 7.52% | 6.96% | -0.01 | -13.30% | |
| Float/Shares Outstanding | 50.21% | ||||
| Current Div Yield | 1.10% | ||||
| 52 wk change | -13.26% | ||||
| Insider Acivity | Neutral | ||||
| YOY Qtrly Rev Incr | 30.10% | ||||
| Avg ROIC 2008 to TTM | 3.81% | ||||
| 3 year Avg Rev Growth | 6.58% | ||||
| EV/EBITDA | 3.74 | ||||
| % Held by Insiders | 45.70% | ||||
| % Held by Institutions | 7.10% | ||||