Tuesday, September 19, 2017

An Interview with NoNameStocks

Jan Svenda interviewed me for his OTC Newsletter a couple of weeks ago.  It was a ton of fun and Jan was great.  He has authored many articles on Seeking Alpha and we have crossed paths on a few stocks.  This is the first and only interview I've ever done.

Today he released a cut down version of the interview on Seeking Alpha and I just thought I'd throw up a link here in case you're interested.

Thursday, September 14, 2017

DEWY: Real Estate, Change, and Survival

Dewey Electronics (DEWY) has annual revenue of about $6M and a BV of $2M. On top of that, their 22 acres of land and facilities has been appraised at $4.5M and completely depreciated. Next to their facilities they have another 68 acres of excess land whose sale for $18M fell through in 2005 due to restrictions put in place by New Jersey's Highlands Water Protection and Planning Act.  You get all that for a market cap of only $1.9M.

The company has recently changed their tune, stating the stock is undervalued and claiming they are working to correct the situation. An 18% shareholder joined the board a few months ago.

I love a tiny company reinventing itself and DEWY is doing just that as they diversify away from their decades long main product, a 2kW rugged military generator.

Friday, August 18, 2017

The ELST Boredom Might be Changing

Electronics Systems Technology (ELST) is another in my long line of small companies with potential.  What can I say other than it fits my style.  Clean balance sheet, low share count, good potential, cheap stock, low range on the chart.

Even if you don't agree on the cheapness you must recognize the story can change in a hurry.

ELST has evidence of change and potential.  That is all.  Quick post.

Tuesday, July 25, 2017

Hydromer and the Value of Potential

A common theme among my stocks is potential. Either a stock has to be incredibly cheap versus the current numbers, priced as if the company is dead, or packed with potential. Above all any stock I'm going to consider must be tiny, illiquid, and low priced.

When I say low priced I mean cheap, and when I say cheap I mean in every sense of the word. A $100 stock may be cheap relative to intrinsic value but it is not absolutely cheap. Even a $20 stock is not absolutely cheap so it would take something real special to get me to venture into that realm. Anything over a few dollars starts making me uncomfortable and my preference is really closer to a nickel. I'm looking for maximum stock price movement and that comes from four things: supply, demand, perception, and resistance.

Friday, June 23, 2017

Activism and a Possible Sale of QDLC

A concerned shareholder group has started a proxy fight at QDLC by calling a special meeting on July 11 to elect a new board.  Their stated intention is increase communication and sell the company ASAP.  The current QDLC board has fought back by calling their first annual meeting in over a decade on July 10.  It's a lot of drama and the craziest part is the CEO is part of the concerned shareholder group!

This is a call to action for all QDLC shareholders to ignore the company proxy and vote yes on the concerned shareholder group's proxy for all new directors.

Wednesday, June 14, 2017

Aggressive Change at DPW

Digital Power Corporation (DPW) is a $4M market cap electronic power supply company under new ownership as of 8 months ago. The ship has turned towards explosive change with a $50M contract and one acquisition already. At the current price you get the old business on the cheap with everything new for free.

Thursday, June 8, 2017

HEMA Annual Meeting June 2017

This will be a summary of today's HemaCare (HEMA) annual meeting.  There was nothing earth shattering but it was still good.  Shareholder attendance was down 33% from last year, which is to say there were only two of us this time...

Monday, May 22, 2017

MRCR at 5x Earnings

This is your annual reminder of how cheap Moro (MRCR) is.  I got the latest report a few days ago and MRCR is currently trading at the following ratios:
  • P/E = 4.9
  • P/BV = 0.52
  • P/S = 0.07
  • P/E cont ops = 4.3

Thursday, May 18, 2017

I've Moved to PennTrade

Hopefully this is my last post on brokerage drama.  I have moved as many accounts as possible out of T Rowe Price and Fidelity over to PennTrade.  When people now ask me which brokerage house they should transfer OTC stocks into, I will answer PennTrade.

Thursday, April 20, 2017

TCCO: Betting on Survival

Technical Communications Corp (TCCO) is a tiny company in the exciting field of encrypted communication.  With a market cap of $4.4M, 1.8M shares out, and no debt they are my kind of company.

Monday, April 17, 2017

NoName Annual Performance 2016-2017

What a year!  My portfolio is up 121.7%, bringing my CAGR to 33.8% since I started investing four years ago.  I'll never match this performance again so let me enjoy this while I can.

Thursday, March 16, 2017

STRI at 22% of Cash

Here is a simple one.  STR Holdings (STRI) is a solar panel encapsulant manufacturer currently selling for 22% of cash, 11% of BV, and 34% of the cash left after paying off all liabilities.  It's a classic net-net.   The stock has been in a death spiral but the chart shows it has found support around $0.15 over the past year.

That's it. Cheap numbers, all time low, chart support. Potential upside vs downside.

The problem is cash burn with a negative operating margin and decreasing revenue.  If you're into quality businesses with a moat this is not for you. If you believe turnarounds don't turn move on.

Tuesday, February 28, 2017

Biomerica is a Buy

Biomerica (BMRA) is a small developer of medical test equipment. They are working on FDA approval of their new product, InFoods, and describe it as a “multi billion dollar market opportunity.” With a market cap of $22M BMRA is in for big things if all goes as planned.

Tuesday, February 21, 2017

EKCS Update: Turning the Corner

I first wrote about Electronic Control Security (EKCS) in Aug 2016: EKCS has big potential.  Since then the company has produced 2016 financial statements, given me a quick 2017 projection, and announced a couple more contracts.  EKCS now has a market cap of $400k with revenue set to more than double in 2017.  My thesis is the same it was when I first wrote about EKCS, but they are further into a turnaround than I thought.

I've talked with the CEO by phone and email several times since my first blog post.  The company is doing well and I'd like to give an update

Thursday, January 12, 2017

IOMT: Market Cap Less Than a Gallon of Gas

The current market cap on Isomet Corp (IOMT) is $2.10.  As in two dollars and ten cents.  Not share price...market cap.  Comically cheap.  If "nano cap" refers to companies valued less than $50M, what would you call this?  Spend one commission and get a company for free.

Friday, January 6, 2017

Will QDLC Ever Post a Report?

Quadlogic Controls (QDLC) is a dark company I first wrote about a year ago.  They last posted a report in 2012, earning $0.16 for the year.  Stock price is now $0.40 for a PE ratio of 2.5.  The only numbers anyone has seen out of QDLC from 2000 until now is the 2012 report.

***
Update 1/6/2017: QDLC updated the investor relations page of the website and posted an annual report for 2013!  They did this sometime between last night when I finished typing this post and this morning 2 hours after I published it.  
***

The company tells me they'll be posting an audited annual report within the next month and a half.  The question is will they follow through...

Tuesday, January 3, 2017

ADDC is Getting Cheaper

We got the Addmaster (ADDC) annual report in December and I went to the annual meeting.  It was a good year.  With another million in the bank and some talk of a tender I think this stock is worth twice the current price.