The December issue of Ultimate Value Finder is now out. I covered three investment opportunities:
Investment Opportunity 1
I previously wrote an article about this company. At that time, the stock price was trading for a little less than $13 per share. Within several months, the stock price more than doubled. Intraday, it reached as high as $27 per share and it was for a good reason. The company continues to grow and expand internationally. I really like this company and I have owned it since 2009. At $27 per share, it was more than a five-bagger for me since I purchased it for $5 per share. But then, Mr. Market could not just sit tight. He had to do something, so here he goes again. Since the stock price reached its peak in February 2012, it is back down to $13 per share as shown by the following graph.
Investment Opportunity 2
It really is amazing some of the things that the market is capable of doing to the stock prices of some businesses. But then, if it wasn’t for dumb traders, there would be no need for value investing since everything would be priced correctly. This is the stock chart for Investment Opportunity 2 from the time that the company went public.
As you can see, towards the end of 2007, the stock was trading around $1.35 per share, then it collapsed along with the rest of the stock market to as low as $0.32 per share in March 2009. By the end of 2009, it strongly rebounded to more than $2 per share. On January 21, 2010, it reached the peak of $2.42 per share. Since then, the stock price kept on getting pounded over and over again. As of the date of this report, the stock is trading for approximately $0.65 per share.
While there has been a lot of price volatility from the time that the stock started trading to where it is today, there is something interesting to point out. When the company’s stock started trading at the end of 2007, the price was $1.35 per share. At that time, the company’s revenues were only $2.2 million and net income was negative. Today, revenues are approximately $60 million (27 times more than in 2007) and net income is positive, but the stock price is only $0.65 per share.
Investment Opportunity 3
It is no secret that a healthy eating revolution is in full force. People are finally realizing that good nutrition is key to a healthy lifestyle. As a consequence of this trend, businesses such as Whole Foods are seeing their stores packed with customers. Even businesses such as McDonalds are including healthy menu choices.
Investment Opportunity 3, a quick-service restaurant concept, is also riding the healthy-eating-revolution trend, but unlike other businesses in this space, it is not as expensive. Several years ago, the company was a mess – it nearly went bankrupt. Then, the new management came in, fixed it up, and finally got it running smoothly. Now, the plan is to step on the gas and get it going at a level that it is capable of running. The healthy-food-revolution is still in its infancy.
If you an Ultimate Value Finder subscriber, then you already received a separate e-mail with the full December issue. If you didn’t subscribe yet, but wish to do so, click here.