Comments on: Net Net Investing Spreadsheet for 20 NCAV Stocks

By: Jae Jun

Jae Jun — Mon, 18 May 2009 05:14:30 +0000

Shadow stock wrote up some very brief numbers on PDII.

http://shadowstock.blogspot.com/2009/05/insider-micro-cap-value-buying-on.html

By: Jae Jun

Jae Jun — Tue, 12 May 2009 17:32:41 +0000

Note on HRAY. The other company that HRAY may have been referring to that was interested in buying them out turns out to be Shanda. Will have to see whether an offer is made. This is probably why they didn’t both to respond to Best Prospects.

If Shanda makes a bid, this is all good but if it doesn’t go through, management and the board must seriously answer to the shareholders.

http://tinyurl.com/qqd4cv

By: Jae Jun

Jae Jun — Tue, 12 May 2009 04:49:26 +0000

Yeah. The 3 I mentioned may be the last ones for me as well. I’ll have to move back to getting high quality companies at good prices rather than the distressed companies at dirt cheap prices.

By: Jim

Jim — Tue, 12 May 2009 04:24:18 +0000

Nice net net list, unfortunately I wasn’t able to find one that peaked my interest. Net-net’s are definitely drying up and quality net-net’s are almost non-existent. As Graham noted, not every net-net warrants an investment. I haven’t found many lately.

By: North Fork Investors

North Fork Investors — Mon, 11 May 2009 22:49:59 +0000

Thanks for the info! A number of these will undoubtedly look like no-brainers in years to come. Now if only there was some way to screen for hidden liabilities – litigation, labor costs, etc.

North Fork Investors’s last blog post..Greenlight Capital Q1 2009 Update

By: Jim

Jim — Mon, 11 May 2009 21:32:13 +0000

“That’s what I would like to find also but it’s very close to impossible with the stuff that I’m looking at. A net net with cash, FCF positive and growth… that would be the fattest pitch ever.”

About a 1 1/2 months too late to meet all those criteria for HURC but I still believe its an exceptional company. I’ve been following HURC for over a year and took a pass on it 3 times. Each time I would have made money but hesitated. I’m Looking at it a 4th time now and still have not made a decision but as far as FCF, CROIC, ROE; it has it all.

By: Jae Jun

Jae Jun — Mon, 11 May 2009 20:59:30 +0000

That’s what I would like to find also but it’s very close to impossible with the stuff that I’m looking at. A net net with cash, FCF positive and growth… that would be the fattest pitch ever.

From my work experience, I’ve used SWIR modems and other products but never found them to have a big advantage over a competitor and I’ve known about SWIR for a long time but never liked the business so I guess I am being biased on this one.

Since SWIR should be based more on a going concern, it does seem like SWIR is trading at a big margin of safety (currently around 58%) and it is FCF positive as you say. My guess is that SWIR is worth $13 as a going concern but that is a raw guess.

I wonder how SWIR will be affected if there really is a downturn in the telecom industry. Its major customers are the big carriers in the US, Australia and other countries.

If you feel strongly about SWIR or something else, let me know your rationale as I am interested to hear and consider any potential homeruns.

By: PlanMaestro

PlanMaestro — Mon, 11 May 2009 20:06:17 +0000

Jae, thanks again for sharing your work with the rest of us.

Have you thought of looking for not necessarily net-cash, but companies with significant cash, cash flow positive, and growth potential (i.e. Sierra Wireless)? I understand the downside protection, but would not it be possible that we are discounting the upside too much?