Planar Systems (PLNR) Update

Posted on December 19, 2005

Planar´s (PLNR) 10K came out recently. I´m not sure why the stock has been weak recently. But, as is usually the case, the stock movement probably does not reflect at all on PLNR´s long-term prospects. In any case, here are two important tidbits from the 10K.

Financial Position: Very strong. Company is sitting on net cash of about $60 million or $4.10 a share. As noted in our initial write up of the company, this cash position provides good downside protection for the stock.

Future of the Business, or Upside: Here is the relevant quote from the 10K

"At the end of fiscal 2005, a new
Chief Executive Officer was hired, who began
the process of leading a review of the Company’s strategic plans and
objectives. The goal of this review is to build upon the Company’s
strengths and opportunities to construct a plan for growth, operational
improvement, and shareholder
value enhancement by determining the best growth opportunities for the
Company. This review may lead the Company to enter some new markets and
possibly reduce or minimize focus on some current markets."

Looks like the company will divest or sell some parts of the current business and invest capital on new growth opportunities. I have no idea what is in store for PLNR, but with a solid cash position, a new management team with a good track record of increasing shareholder value, and numerous secular growth opportunities in the flat-panel display market, PLNR is still a good investment gamble.

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