Getting Cheaper All the Time
Believe it or not, even in this rising market, there are still attractive opportunities that have gotten even more attractive. It seems our old friend Mr. Market has no patience for stocks that don't join the party. So, he indiscriminately abandons them, which raises the hopes of value-seeking investors.
Value Line (VALU), publisher of its tried-and-true Value Line Investment Survey, is one such candidate left out in the cold by Mr. Market. Trading near a 52-week low at about $9.50 a share today, it's a sign of today's quantitative-easing-induced euphoria that investors are selling shares, thereby disregarding a yield of 6.5%. Valued at just under $100 million, this microcap also comes with a pristine balance sheet containing zero debt and nearly $10 million in cash. In September, VALU reported quarterly net income of $1.8 million vs. $2.1 million over the same period a year ago. Mr. Market wasn't impressed, and the result is a valuation that looks very attractive and safe today. Value Line has and remains a trusted source of investment data and the company is expanding its offerings to cater to today's hedge funds and other institutional clients. Management appears convinced that shares represent a good value: Five days after the earnings release and subsequent share price drop, the company announced a $3 million share buyback. At the current valuation, the buyback is equal to nearly 4% of the outstanding shares. ...270 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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