Planar (PLNR) Still Significantly Undervalued
Posted on January 26, 2006
Well, Planar (PLNR) came out with earnings this morning, that just blew me away. I wish I had more of this stock, but who knew how quickly this thing would turnaround. Maybe prior management was not all that bad.
In any case, PLNR continues to print cash and is at the start of
what seems to be a new growth phase for the company. On the financial
front, PLNR generated $7 million in cash during the quarter to end with
$72 million in cash or about $4.80 per share. Amazingly, this company
has almost no cap-ex, so this is real cash-flow. All in all, with no
significant growth assumed from here out (a conservative assumption), I
think the company will generate at least $20 million in cash a year, so
I think the stock should be trading at a minimum of $18 or a $270 million market cap. Now, if the company can start getting revenue growth back up into the double digits, that target price will prove to be quite low.
Hang on to this gamble.
If you would like to read my initial write up of PLNR, please click here.
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