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ACRG
(Nasdaq)
- This week's pick is a slam dunk...it isn't often we find a stock this
low priced (closed Friday at 1 3/16) with such terrific fundamentals:
- Earnings
latest quarter (August 99) - $.14 (up 27% from same Qtr. last
year)
- Earnings
latest 12 months - $.18 (up 125% over previous 12 month period)
- 5 year
growth rate - 22%
- Return
on Equity (ROE) - 20.9%
- Price
to Book - 1.3
- Price
to Sales - .12
- P/E
- 7
- Insider
activity - recent buying / no recent selling
- Institutional
ownership - 2.9%
ACR
Group, Inc. is a wholesale distributor of heating, ventilation, air
conditioning, and refrigeration (HVACR) equipment and supplies. ACRG
has expanded its operations into 9 Sunbelt states with a total of 37
branch locations. ACRG serves both
commercial and residential HVACR contractors, supplying equipment and
parts for both new construction and renovation / replacement. ACRG's
stock price has been languishing recently despite good earnings growth
and solid fundamentals largely for 2 reasons: it's trading in an unsexy
sector, and second, it's in a price range that gets little or no attention
on the Wall Street radar. ACRG is
reminiscent of another low priced stock I took a position in a few years
back, MINI. MINI is engaged in the sales and leasing of
portable storage units. Not a very sexy sector either, but MINI
had a great business plan and kept growing earnings. For a while, the
stock traded thinly and didn't seem to want to move up. Now 3 years
down the road, MINI is trading at $20+ a share. I don't know
if history will repeat itself here with ACRG,
but in the Stockprowler's humble opinion, it has the potential to take
off...especially given the fact the Sunbelt is a very hot construction
market.
Good
trading... Stockprowler
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