OTCPK:ESCC - Post by User
Post by
Geodan2on Apr 03, 2019 4:37pm
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Post# 29578584
Never a Post on ESCC, And maybe best value stock of 2019
Never a Post on ESCC, And maybe best value stock of 2019The 2 go together, unknown stocks can develop extreme value because they are unknown.
If anyone is interested ESCC is maybe the most undervalued stock have ever found. It is 0.41 EV/EBITDA. seekingalpha.com/...
They are the world leader in digital planetariums, domes. The full name is Evans & Sutherland Computer Corporation. For those familiar with computer graphics ESCC are the inventors of the field. Several billionaires came out of the firm including Jim Clark of Netscape and Silicon Graphics, and Adobe's founder/CEO also came out of ESCC. en.wikipedia.org/...
Right now they have they have market cap of $9 million and $8 million of cash with both net income and operating cash flow of $3.75 million off of $37 million in sales. They have $2.5 million of free cashflow.
I have been most of the buying in last week, it has low float and low volume. The website shows the products and shows they produce https://www.es.com/
The way look at it is if you buy the company for $9 million which on incremental basis you can now you get $8 million cash, so you are out a net $1 million, you do have 1.5 million in debt and a legacy pension system they pay about $1 million a year on that goes away in 8 years and they are making their profit and cashflow now after paying the pension off. Talked with the CFO Paul and he was very businesslike. Not interesting in promoting the stock, interested in getting results and figures stock will take care of itself. Liked that. They may buy stock back (I suggested it and they already are authorized to do it).
They do not have a lot of recurring revenue, they have to keep selling these domes and systems. But for a net $1 million outlay you get almost $4 million a year in profits. the status quo is acceptable.
After being a high flyer 10 bagging in 1970s to $40 and being over $25 in 1990s they got in trouble with their pension plan and shift to PCs. It is .75 now and has down in flat base for 10 years. The market has forgotten about it, yesterday 20,000 shares. But with an EV/EBITDA of 0.41 which is the lowest have ever seen that is legit think this can not last as long as current results continue. The PE is 2ish and ROE is 67%. The company even grew 20% last year. Insiders own 60% so company could easily buy back 50% of the float and still have a pile of cash. And being they have all this technology maybe they can sell it for non dome use.
Maybe missed something big, if you see a big danger please post. Thought would pass along my research into the company. Cheers
Forgot one more thing, the average employee (they have about 100) works 20 years for the company, that is the highest have ever heard of. People love working there.