Ah, the difference a week can make.
On September 30th, when I did the quarterly update on the Uproar Fund, MRRM was smelling worse than my underpants after a light jog. The stock had sunk to $2.60 per share, significantly below my average purchase price of $3.20. I picked up an additional 900 shares personally (as in, not included in the Fund) on October 2nd, which represented 90% of the trading volume that day. I also upped the price from $2.60 to $2.70 with my limit order.
Finally, I moved the market.
And then, after hours on the 2nd, the company came out with great earnings. Revenue was up 17.7% compared to the same quarter last year, and profit surged, from a loss of $0.02 per share last year to a profit of $0.12. Business was up, rice prices declined, the company paid off about half of its outstanding debt, and it even threw us a bone with comments about continuing the strategic review, apparently even bringing in a second party.
This is all good, and it even did it while the Canadian dollar went down, which impacted margins.
Based on the results, the stock shot up to $3.28, although not on a huge amount of volume (Although, let’s be honest, this stock never does huge volume). It did 1,000 shares that day, but that was it. I’ve been putting in bids at $3.10 over the past few days, but shares haven’t budged.
Book value is $6.99/share, and the company has earned $0.22 per share over the last 12 months. Based on a $3.10 purchase price, you’re getting the company at 14 times earnings, and that drops to just 7.1 times earnings if you exclude the company’s nearly $4 million of stocks, bonds, and other investments it holds on the balance sheet. If you believe management will eventually spin some of those investments off as a special dividend (which it has repeatedly in the past, most recently in 2012), then you’ve got to like the company here.
But please don’t buy. I don’t want the competition.
Time for links
Start things off with Nelson? LET’S GET THE SEXY OUT OF THE WAY. Over at the Fool that is Motley, I took a look at Talisman Energy, a oil company that I think has potential as a long-term turnaround. Plus, Carl Icahn owns some, and that dude is the best.
More Nelson? WHY NOT. I took a look at three struggling companies and asked if they’ll last five years. One was Sears, because it’s more worthless than Bernie Madoff’s Discover card.
Boomer and Echo asks how many stocks you should own. I won’t give away the answer, but it’s more than 1 and less than 4,039,928. I tackled this a few months back too, because everything has to be about me. What? I’m a millennial.
Here’s a guy who thinks real estate prices in Canada are going to fall 50%. That seems a little excessive, but I am intrigued and would like to sign up for his newsletter.
I keep telling you guys, it’s not that hard to get rich. It just takes sacrifices. Pauline from Make Money Your Way tells us how she’s getting roommates to pay her mortgage (and then some) in a place she doesn’t even live anymore.
And that’s all I got. Have a good weekend everyone.