by Reptar4President
I’m looking at putting some money into a few different small and micro-caps, and one big boy. Thought I’d put them out there and see if anyone has any thoughts on them.
Some background: I used to trade individual stocks (we’re not talking much, I had maybe $20k in a fund) but stopped about 6 years ago, as I just didn’t have time to keep up with the market anymore. I moved everything into Vanguard ETFs and all that is fine and still sitting there. I have more time available now, as well as more money, and it seems like as good a time as any to get back into the market with some money I can afford to play around with (and lose without it ruining me).
I try to stay away from industries I can’t understand. Biotech, for example. I just trade long, nothing short. I’ll never beat the pros and the fees would kill me anyway. With one real exception, GM, I’m just looking for undervalued small or micro-caps with solid fundamentals under the hood and room for growth. Ideally with a dividend but not required. Should be earning solid cash flow and limited, if any, long-term debt. Right now, I’m mostly looking at stocks trading under $50/share. Here’s what I’m looking at:
| Price | P/E | EPS | P/B | P/FCF | Div. | NCAVP | CAGR | |
|---|---|---|---|---|---|---|---|---|
| DMLP | $9.31 | 6.06 | $1.50 | 2.83 | 7.13 | 15.95% | 0.68 | 13% |
| OSK | $64.33 | 7.90 | $7.81 | 1.46 | 10.65 | 2.07% | 5.21 | 53% |
| NC | $27.98 | 4.94 | $5.66 | 0.65 | 8.92 | 2.83% | 6.47 | -162% |
| KELYA | $12.69 | 4.42 | $2.84 | 0.37 | 6.87 | 2.53% | 4.85 | – |
| FL | $22.05 | 4.96 | $4.59 | 0.94 | 6.65 | 7.17% | -16.57 | 17% |
| GM | $20.78 | 4.66 | $4.57 | 0.73 | 6.35 | 7.11% | -74.95 | -206% |
| PZN | $4.46 | 10.01 | $0.45 | 2.54 | 5.04 | 12.22% | 0.52 | 9% |
| GLDD | $8.30 | 9.35 | $0.86 | 1.79 | 3.48 | 0.00% | 4.97 | -282% |
| NVFY | $1.10 | 2.82 | $0.41 | 0.09 | 1.00 | 0.00% | 12.14 | -14% |
They all appear to me to have good fundamentals. Low LT D/E, good cash flow. Reasonable P/Es, not overvalued, and room for growth. I’ve been digging into the 10-Ks and I don’t see anything glaring. Foot Locker feels like one of Buffett’s cigarette butts. Maybe it’s in a dying retail business but, based on their fundamentals, I think they have a few good puffs left.
NVFY is really interesting to me. I can’t decide if I want to put money into them or not. They’ve got a really good business selling furniture, mostly in LA, Hong Kong, and Macau. They’re sitting on a ton of assets, worth more than their price. No debt, great cash flow. Seem to be making money hand-over-fist. But they just got hit with a series of related class action lawsuits and coronavirus has basically stopped their business in its tracks. So the fundamentals are really good but they have these pretty big obstacles right now that could kill them. It’s an interesting situation.
I don’t think I need to write out a treatise for each unless someone wants to know my thinking, but they all look good to me with the possible exception of NVFY. Curious if anyone has any thoughts about them. Feel free to mock me if these are stupid thoughts.
Disclaimer: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence.