USAP - Universal Stainless & Alloy Products

[mjohn707]

Universal Stainless & Alloy is a US-based company that is experiencing losses due to weak commodity prices and the expense on a large debt incurred procuring a new metal processing plant.  Despite these negatives, the current price of $10.85 is only about 2/3rds of the price that superinvestor Monish Pabrai paid for his shares.  What could go wrong with this investment?

 

This situation might sound familiar but I promise you’re not accidently reading the wrong thread.  Monish purchased his shares at $15 way back in 2002 and he sold out of the stock long ago.  Since that time the company’s shares have sold as high as $50 per share back in 2007 and as low as $8 as share during the financial crisis of 2008.  And while over the last five years the shares have sold at an average price-to-book value of around 1.2, the current price of $10.85 is about 40% of book value.  In addition, the market cap of 80M is less than the 2011 purchase price (110M) of the new steel mill.  Although the company faces some headwinds and potential losses for the rest of the year (at least), I think that there is a reasonable upside at the current price with more downside protection than Monish’s other favorite investment.

 

Over the 20-year history of the company ROIC has averaged about 9%.  Over the last 5 years, ROIC has averaged about 4-5% during what I believe to be very difficult times in the steel industry.  The debt-to-equity ratio of the company was about 40% as of the most recent fiscal year.  The debt is comprised mostly of an asset-based line of credit and associated term loan with pretty lenient covenants and some way out of the money convertible bonds issued to the people they bought the new steel mill from.

 

The basic thesis is that the company should stop losing money once commodity prices stabilize and they work through higher cost inventory.  Steel demand should pick up a bit too once their steel service center customers stop liquidating their excess inventory and resume normal buying patterns.  After that the company should have a chance to earn a reasonable return on capital once the steel industry recovers.  A weaker dollar would help because a strong dollar favors foreign competitors.  I believe the company historically enjoyed some labor cost advantages that they might no longer possess, but management is currently trying to shift production to higher margin products that, if successful, should help earnings recover. 

 

If the company can recover their historical profitability the stock should be worth book value.  I’m attaching a copy of my worksheet that includes a 20-year earnings summary, a calculation of book value per share as of the most recent quarter, and a few interesting ratios.

universal_stainless__alloy_products.xlsx

[Simple Investor]

I'm glad you wrote something up on this company.  I see they did a goodwill write off of 20mm that triggered my attention last week.   

 

first 9 months they are at 30mm in EBITDA -with a current EV of 150mm.  Definitely something to keep an eye on.  I don't know anything about the biz except that it looks cheap.  If they can get to a growth mode the value would be significant. 

[mjohn707]

I'm glad you wrote something up on this company.  I see they did a goodwill write off of 20mm that triggered my attention last week.   

 

first 9 months they are at 30mm in EBITDA -with a current EV of 150mm.  Definitely something to keep an eye on.  I don't know anything about the biz except that it looks cheap.  If they can get to a growth mode the value would be significant.

 

All I know about the business is what they put in the 10-K, mainly that the company produces stainless steel and a few other specialty alloys, and that they’re pushing to increase sales of certain “premium” alloys to increase margins.  The amount of debt bothers me, but I think that unless sales really fall off a cliff they should be able to continue to service it.  It seems like their lenders have been willing to work with them over the last year or so with their covenants. 

 

The company claims that it’s end markets (mainly aerospace) are healthy and that the soft demand is an inventory reduction thing.  I think that if the business mean-reverts it’s a double or more from here.  And on the downside, if the new plant they acquired for 110M in 2011 is actually worth what they paid for it, the current stock price should be around liquidating value even if we assume dour Graham-style discounts for the rest of the assets.

 

I know this one won’t be for everyone because it’s a commodity business that’s going to produces losses for a while, but I do think there's some value here.

 

[mjohn707]

This is up a bit over 50% from the time of my original write-up, and is somewhere in the range of 70% of book value presently.  Although I don't think it's approached fair value yet, I might lighten up somewhat on my position and I just wanted to update if anyone else is in this thing 

[samaniv]

Hey John,

 

I wrote this up, mainly just for myself. I like to do quick half hour write-ups (when too busy to do a proper one) - just to jot down some of my thoughts and revisit them at a later date to see how things progress.

 

Universal Stainless and Alloy Products - Not Your Normal Steel Company

 

Steel companies are most often known for their cyclicality, poor return on capital, high capital expenditures, and commodity-like nature. They prove extremely difficult to value as the profitability of most steel companies depends on the price of the steel.

The key word is usually. Universal stainless is different from your average steel company. Rather than providing commodity-like steel, they provide specialty steel products to large blue-chip customers.

 

There are a couple of very important implications of providing specialty steel (as opposed to commodity steel). Universal does not depend on the price of commodity inputs in order to generate a profit. Instead, many of their finished products have a “sales-pricing surcharge mechanism” in order to match sales price to raw material price changes. For some products it is calculated at time or order entry and for others it is recognized based on monthly avg raw material prices for two months prior to ship date. The long and short of this is that when input costs rise, sales prices rise. When input costs fall, sales prices fall. This essentially protects USAP against rising input commodity prices, ensuring that they are able to pass along the price increases to customers.

 

Another important aspect of being a specialty steel producer is the requirement of customer approvals. As mentioned earlier, USAP serves large blue chip customers including: Airbus, Boeing, Bombardier, Rolls-Royce etc. Recently, USAP got approval from Rolls-Royce which took them 2.5 years for 6 alloys. Every grade requires a site specific approval. This is important as it prevents competitors (such as foreign steel) from coming in and gaining market share. USAP business is built on long-term customer relationships, which are difficult to replace (given the time-commitment involved in obtaining customer approvals).

In addition to the above advantages resulting from producing specialty steel, USAP has a proven track record of allocating capital efficiently. Three of our four of their facilities were acquired in distress transactions for pennies on the dollar. Management has said in conference called that Bridgewater acquired for 4-5M has an estimated replacement cost in the 150M range. Dunkirk acquired for 4.1M has a replacement cost around 80-90M. Recently, management has acquired a facility in North Jackson, Ohio for roughly 150M. While this one wasn’t acquired in a distress sale, it was acquired for the purpose of providing vacuum-induction melting and moving into more premium alloys. Management has noted that these advanced alloys allow USAP to make more technologically advanced products with the aim of increasing margins.

 

Management has consistently produced positive cash flow every single year (quite the accomplishment in the steel industry). They also have managed to decrease debt from about 100M in 2012 to 72M in 2016.  The debt to capitalization is around the 30% mark and management has plenty of time, given that they recently extended their maturity out to 2021.

The most attractive part, however, is the valuation. The enterprise value is around 170M (3/20/17), which is around what USAP paid for the North Jackson, Ohio facility. This isn’t taking into account the other 3 facilities which have been fully depreciated and have a replacement cost far in excess of their book value.

 

The reason this bargain exists is that demand for USAP’s products has been slaughtered. The reason for this was twofold. Firstly, falling commodity prices (a deflationary environment) caused USAP to incur inventory period holding losses. In essence, this meant that USAP was producing inventory at a high cost, and selling it (based on avg of two preceding months), which placed immense pressure on their margins. Secondly, USAP does not supply its products directly to its end markets. Instead, roughly 70% of their sales go through service centers. Steel service centers are essentially wholesalers that buy steel from a manufacturer, store it, and sell it to the end user as needed. As a result, fluctuations in service center inventory levels, have a direct impact on demand for USAP’s products. In this case, service center destocking caused a sharp drop in volumes at the exact same time as commodity prices were falling and margins were being squeezed, due to the sales pricing mechanism.

In addition, the oil and gas downturn caused significant declines when compared to 2013/2015. However, given that oil and gas is only around 10% of sales – I don’t believe this to be a huge issue. Any upturn in oil and gas industry would be a bonus.

If we assume no incremental EBITDA contribution due to the North Jackson facility, USAP probably has the ability to get back to 2011/2012 levels of revenue/EBITDA over a cycle. This implies somewhere around the 40M range of EBITDA. If we apply a conservative 7x EV/EBITDA multiple, USAP would be worth around 280M EV. That represents >60% upside from today’s levels.

 

I believe the above is a conservative estimate of value, given that I am not incorporating higher margins due to increase premium alloy sales or additional revenue resulting from the expanded fixed asset base.

 

I wrote the above when the share price was closer to $13 per share, but given how volatile this stock is, we could easily see it fall back to those levels on no news. Something else I want to point out is that, though I believe they can get to 40M range of EBITDA and at that level we would see at least a 7X multiple, i'm not sure that this is the right way to determine the true intrinsic value of the company. I think the true intrinsic value would be calculated by determining their normalized EBITDA over a cycle and applying an appropriate multiple. It's hard to say what the normalized EBITDA would be given that we don't have any history on the new plant. We can only guess.

 

 

 

 

 

[mjohn707]

Hey John,

 

I wrote this up, mainly just for myself. I like to do quick half hour write-ups (when too busy to do a proper one) - just to jot down some of my thoughts and revisit them at a later date to see how things progress.

 

Universal Stainless and Alloy Products - Not Your Normal Steel Company

 

Steel companies are most often known for their cyclicality, poor return on capital, high capital expenditures, and commodity-like nature. They prove extremely difficult to value as the profitability of most steel companies depends on the price of the steel.

The key word is usually. Universal stainless is different from your average steel company. Rather than providing commodity-like steel, they provide specialty steel products to large blue-chip customers.

 

There are a couple of very important implications of providing specialty steel (as opposed to commodity steel). Universal does not depend on the price of commodity inputs in order to generate a profit. Instead, many of their finished products have a “sales-pricing surcharge mechanism” in order to match sales price to raw material price changes. For some products it is calculated at time or order entry and for others it is recognized based on monthly avg raw material prices for two months prior to ship date. The long and short of this is that when input costs rise, sales prices rise. When input costs fall, sales prices fall. This essentially protects USAP against rising input commodity prices, ensuring that they are able to pass along the price increases to customers.

 

Another important aspect of being a specialty steel producer is the requirement of customer approvals. As mentioned earlier, USAP serves large blue chip customers including: Airbus, Boeing, Bombardier, Rolls-Royce etc. Recently, USAP got approval from Rolls-Royce which took them 2.5 years for 6 alloys. Every grade requires a site specific approval. This is important as it prevents competitors (such as foreign steel) from coming in and gaining market share. USAP business is built on long-term customer relationships, which are difficult to replace (given the time-commitment involved in obtaining customer approvals).

In addition to the above advantages resulting from producing specialty steel, USAP has a proven track record of allocating capital efficiently. Three of our four of their facilities were acquired in distress transactions for pennies on the dollar. Management has said in conference called that Bridgewater acquired for 4-5M has an estimated replacement cost in the 150M range. Dunkirk acquired for 4.1M has a replacement cost around 80-90M. Recently, management has acquired a facility in North Jackson, Ohio for roughly 150M. While this one wasn’t acquired in a distress sale, it was acquired for the purpose of providing vacuum-induction melting and moving into more premium alloys. Management has noted that these advanced alloys allow USAP to make more technologically advanced products with the aim of increasing margins.

 

Management has consistently produced positive cash flow every single year (quite the accomplishment in the steel industry). They also have managed to decrease debt from about 100M in 2012 to 72M in 2016.  The debt to capitalization is around the 30% mark and management has plenty of time, given that they recently extended their maturity out to 2021.

The most attractive part, however, is the valuation. The enterprise value is around 170M (3/20/17), which is around what USAP paid for the North Jackson, Ohio facility. This isn’t taking into account the other 3 facilities which have been fully depreciated and have a replacement cost far in excess of their book value.

 

The reason this bargain exists is that demand for USAP’s products has been slaughtered. The reason for this was twofold. Firstly, falling commodity prices (a deflationary environment) caused USAP to incur inventory period holding losses. In essence, this meant that USAP was producing inventory at a high cost, and selling it (based on avg of two preceding months), which placed immense pressure on their margins. Secondly, USAP does not supply its products directly to its end markets. Instead, roughly 70% of their sales go through service centers. Steel service centers are essentially wholesalers that buy steel from a manufacturer, store it, and sell it to the end user as needed. As a result, fluctuations in service center inventory levels, have a direct impact on demand for USAP’s products. In this case, service center destocking caused a sharp drop in volumes at the exact same time as commodity prices were falling and margins were being squeezed, due to the sales pricing mechanism.

In addition, the oil and gas downturn caused significant declines when compared to 2013/2015. However, given that oil and gas is only around 10% of sales – I don’t believe this to be a huge issue. Any upturn in oil and gas industry would be a bonus.

If we assume no incremental EBITDA contribution due to the North Jackson facility, USAP probably has the ability to get back to 2011/2012 levels of revenue/EBITDA over a cycle. This implies somewhere around the 40M range of EBITDA. If we apply a conservative 7x EV/EBITDA multiple, USAP would be worth around 280M EV. That represents >60% upside from today’s levels.

 

I believe the above is a conservative estimate of value, given that I am not incorporating higher margins due to increase premium alloy sales or additional revenue resulting from the expanded fixed asset base.

 

I wrote the above when the share price was closer to $13 per share, but given how volatile this stock is, we could easily see it fall back to those levels on no news. Something else I want to point out is that, though I believe they can get to 40M range of EBITDA and at that level we would see at least a 7X multiple, i'm not sure that this is the right way to determine the true intrinsic value of the company. I think the true intrinsic value would be calculated by determining their normalized EBITDA over a cycle and applying an appropriate multiple. It's hard to say what the normalized EBITDA would be given that we don't have any history on the new plant. We can only guess.

That’s quite an impressive write-up for just 30 minutes; it would probably take me twice as long to produce something half the length, and it’d probably be less readable.  I agree that the company is probably worth more than the current price of $17, maybe even more than book value, and that it’s pretty fuzzy to figure it out because you’d have to be able to predict steel prices, maybe regulatory changes, and the success of new management policies which is all very difficult to handicap.

 

I’m perhaps a bit less certain than you are about nature of their product, I suspect they’re basically a commodity producer and don’t have any significant competitive advantages, but I believe at the right price the investment still makes sense.  I’m also a bit skeptical that the purchase price of their older plants means that they’d have a bigger market value now in some sort of liquidation scenario, but I certainly could be wrong about that. 

 

If you ever have the time I’d be interested in talking over the phone about USAP and cyclical stocks in general

 

[samaniv]

Hey John,

 

For sure, I would also be interested in having a conversation about cyclical stocks. I don't have a long investing track record, especially in these types of companies - so I definitely could be wrong in some areas.

 

I don't know too much in terms of how susceptible they are from foreign steal coming in and gaining market share. But given that their largest end-market is Aerospace, I'm not convinced China steel would have the appropriate customer approvals to be used by the like of Rolls-Royce. To clarify, I do not thing this is a great business with strong competitive advantages. I also don't think that this is a bad business which is purely commodity-like. I think it probably lies somewhere in between.

 

I also think that the purchase of their older plants at distress prices definitely means they would fetch more than carrying cost in a liquidation. That being said, if they had to liquidate these, it would probably be in a very distressed market (otherwise why would they liquidate?) so this is very much a theoretical exercise anyways. 

 

Also interesting to note that you've calculated average historical ROIC as around 9%. That being said, this might be higher than go-forward ROIC given that the North Jackson facility wasn't a distress transaction, therefore the invested capital is much higher. May be hard for them to earn a proportionate return as what they did in other transactions.

 

That being said, I feel like all the above points are pretty minor to the investment thesis. Simply put, if USAP can ramp up production and get to former levels of revenue, they will probably do well. As earnings rise, typically we see multiple expansion (which I think is wrong - I think it should contract, since higher risk of being at cyclical peak). So I think we are really betting on demand recovering here... when we really get down to it...

 

 

 

 

[mjohn707]

Hey John,

 

For sure, I would also be interested in having a conversation about cyclical stocks. I don't have a long investing track record, especially in these types of companies - so I definitely could be wrong in some areas.

 

I don't know too much in terms of how susceptible they are from foreign steal coming in and gaining market share. But given that their largest end-market is Aerospace, I'm not convinced China steel would have the appropriate customer approvals to be used by the like of Rolls-Royce. To clarify, I do not thing this is a great business with strong competitive advantages. I also don't think that this is a bad business which is purely commodity-like. I think it probably lies somewhere in between.

 

I also think that the purchase of their older plants at distress prices definitely means they would fetch more than carrying cost in a liquidation. That being said, if they had to liquidate these, it would probably be in a very distressed market (otherwise why would they liquidate?) so this is very much a theoretical exercise anyways. 

 

Also interesting to note that you've calculated average historical ROIC as around 9%. That being said, this might be higher than go-forward ROIC given that the North Jackson facility wasn't a distress transaction, therefore the invested capital is much higher. May be hard for them to earn a proportionate return as what they did in other transactions.

 

That being said, I feel like all the above points are pretty minor to the investment thesis. Simply put, if USAP can ramp up production and get to former levels of revenue, they will probably do well. As earnings rise, typically we see multiple expansion (which I think is wrong - I think it should contract, since higher risk of being at cyclical peak). So I think we are really betting on demand recovering here... when we really get down to it...

 

In reference to imported steel, they mention in the 10-K that imported steel has high penetration in their stainless and tool steel product lines which represented about 80% or so of their sales in 2016. 

 

Isn't North Jackson the plant where they're producing most of the premium alloys?  I though that plant was a bet on management being able to develop the premium business

[samaniv]

Hey John,

 

I think you are right.

 

I think when I heard management talk about the approvals and how long it took, they were talking about North Jackson Facility and the premium alloys.

 

I took notes on the conference call (but like an idiot), I didn't write down which one it was from. So I am still trying to figure out where I got all this info from exactly...

 

I also have it written down them saying "Announced $125M in incremental revenue – with drop in commodities – probably low 100s. "

 

"Premium Alloy sales – We want it to be 20% of sales – long term. We have a cyclical business , little over 100M of incremental revenue at today’s prices. High teens, low 20s margins. 2017 we will not get 100M, our internal target is to double the volume – tough target but we shooting for. Ross went through misalignment, our pricing is falling faster then our melt cost. Long-term it protects us. Short term it burns you, long-term look like a superstar."

 

So it seems you're probably right in that it is more sensitive to the foreign steel than I had originally thought. Thanks for pointing that out. I don't think it changes the overall thesis, as you mentioned, it makes sense at a certain price.

[samaniv]

One other thing...

 

Do you know how the pricing of their goods works? I mean, I know from their 10-k that they have a sales pricing surcharge mechanism which protects them from increases in RM prices...

 

But generally speaking, would it just be based on market price for the specialty steel? Like overall steel prices?

 

Are the overall steel prices would be highly correlated with their input costs? Like would we expect rising Moly, Nickel etc prices to occur in similar timing to increases in steel (and consequently selling price?)

 

I guess I am just trying to get at, are they really sensitive to the price of steel or is it a flow (like I indicated in my original write-up). Again, I am not 100% sure given my inexperience with the industry.

 

What is your take?

[mjohn707]

One other thing...

 

Do you know how the pricing of their goods works? I mean, I know from their 10-k that they have a sales pricing surcharge mechanism which protects them from increases in RM prices...

 

But generally speaking, would it just be based on market price for the specialty steel? Like overall steel prices?

 

Are the overall steel prices would be highly correlated with their input costs? Like would we expect rising Moly, Nickel etc prices to occur in similar timing to increases in steel (and consequently selling price?)

 

I guess I am just trying to get at, are they really sensitive to the price of steel or is it a flow (like I indicated in my original write-up). Again, I am not 100% sure given my inexperience with the industry.

 

What is your take?

As far as the surcharge, it’s based off of nickel pricing primarily as per the 10-K.  Generally speaking, I’m don’t really know how pricing mechanism works in the sense of how exactly the service centers and the company (and other steel producers) negotiate the price between them, but I would suspect that fundamental dynamic is that the company is primarily a price-taker dependent on the prevailing market prices for their products at the time of sale, at least for the majority of their products.

 

I would also bet that the company is sensitive both to price and flow, and in scarcity industry conditions where raw materials and specialty steel prices are increasing they can take surcharges and additional margin, and in oversupply conditions where material and steel prices are moving the other way, the competitive situation is such that they can’t recover their margin.

 

That’s all just a best guess really though

 

[samaniv]

John,

 

Fairly big rally today after earnings release. Are you still a holder?

 

I still think it is modestly undervalued. I can't place a finger on intrinsic value but I believe it to be upwards of $20. Hard to tell.

 

Might lock in some capital gains and hold the remainder.

 

 

[mjohn707]

John,

 

Fairly big rally today after earnings release. Are you still a holder?

 

I still think it is modestly undervalued. I can't place a finger on intrinsic value but I believe it to be upwards of $20. Hard to tell.

 

Might lock in some capital gains and hold the remainder.

 

Yeah I still hold my full position, book value is $25 a share or so, probably worth north of that.  I don't think it's a terrible idea to start selling a bit now though

[mjohn707]

Just to keep this idea updated, Synalloy (SYNL) proposed a merger transaction with USAP where USAP shareholders would have been the slight majority owner of the combined company.  The USAP board rejected the proposal on 6/28/17 and filed an 8-K with the terms of Synalloy's proposal.  I don't really have any knowledge of Synalloy's business, but the deal didn't sound that terrific to me.  I'm sure that any merger activity might have been a sort of catalyst to realize additional value out of this situation, but I think it would have also increased the degree of difficulty in monitoring this thing going forward, and I just have a distaste for stuff that is really complicated

[samaniv]

John,

 

I also don't have enough knowledge of Synalloy business to know if this was a good deal or not. It seems Synalloy was willing to go public and direct to the institutional shareholders.

 

"The point that I am making here is that a small group of investors controls a significant majority of USAP’s shares and polling them on their thoughts about our indication of interest of merging the two companies would be easy to facilitate. I would prefer to see us explore a possible merger in private, however I am willing to go public with our interest so that the shareholders of both companies can evaluate a merger for themselves."

 

Since we are directly aligned with these institutional shareholders - I am sure they will be able to make a more informed decision on this on our behalves. Either way, its good news that others also believe USAP  business to be undervalued.

 

 

[nwoodman]

Conference Call Notes

• Q1 price increases for stainless and low alloy have started to kick in July

• Surcharges recovering by September not a big issue

• 5 more customer approvals – 4 Aero,  1 Energy Services

• 2 additional premium products commercialized during the quarter

• 15 products under development

• Some expectation that anti-dumping initiatives might be invoked

 

Aerospace

• Good orders for majors at Paris Airshow

• Global traffic up 7.7% YoY

• Building momentum in defence

• Healthy market overall

 

Heavy Equipment

• Construction equipment manufactures tightening market

• CAT turning the corner etc

 

O&G

• Demand flat in most recent quarter

• Slow steady recovery

 

Power Gen

• Market dependent on how many turbines GE choose to build in US

• Maintenance is their focus

 

CC Questions

• A modest improvement in gross margins to mid teens

• Q3 and Q4 generally weaker quarters

• Growth in sales expected even with lower surcharge

• Dunkirk - $8m investment in 4th quarter (mostly 2018 investment with benefits seen in FY18 and FY19)

• See improvement possibility in meltshop more on that later

• IT expenditure potential to achieve tighter controls in the future

• WIP inventory likely to come down in the next couple of quarters, the real issue is getting a higher % done the first time

• Still in development mode for new alloys.  Carrying $6m in R&D inventory, good material and will likely be sold.  A couple years ago it was $13m

• Electrodes there are issues with availability, pricing tight, they are covered until 2018 but  visibility not there.  Could be a hit of $500,000/p.a based on forecast pricing.  This is a minor concern but will affect everyone

 

What they might look like in 12-24 months time

 

Sales:                        $200m (30% sales growth)

Gross Margin:            15%

Gross Profit                $30

SGA                            $5m

Operating                    25

Interest & Am            $5

Pre-Tax                      $20.0

Tax                              25%

Net                              $15 (7.5%)

 

Shares Out                7.3m

EPS                            $2.05

10x’s                          $21

 

Equity                          $183m

BVPS                          $25.1

Current Share Price      $18.33

P/B                            18.33/25.1=0.73

 

 

They have had revenue >$200m in 5 of the last 10 years, not difficult to imagine them achieving similar levels or higher in this cycle.

 

What they might be worth as a bolt on to Allegheny, Carpenter or a foreign player next year or the year after?

 

• 1x’s sales 200/7.3=$27/share

• 8x’s EBITDA = 23.5*8=$25.75/share

• 1x’s Book = $27

 

Cheers

 

nwoodman

 

 

[mjohn707]

Just to update on this name, I sold half of my original position today at about $22 per share, which is a bit above a 100% return on the market price of $10.85 as of the original write up on 10/2/15

[samaniv]

I also sold half - 3/4 of my position around $21.50 - $22.

 

[mjohn707]

When I sell shares it almost guarantees that they'll at least double pretty quickly after

[mjohn707]

Sold the other half of my shares today for $22, so I'm out of this completely 

[samaniv]

I am still holding 1/4 of my position - but probably time to get out soon.  No longer a value investment.

[mjohn707]

This is back below $13 a share, and around 50% of book value.  I think shares might be interesting again if you have a strong stomach

[samaniv]

Thanks for pointing this out John.

 

I agree. Very cyclical stock. Extreme gyrations may present an interesting opportunity.

 

It seems the capital raise last year was quite timely.