A Sweet Opportunity?
June 08, 2010
– Comments (7) |
RELATED TICKERS: IPSU.DL
Pssst. Want to see an ugly chart? How about this one:
This is the three month performance of a company called Imperial Sugar (IPSU). Imperial Sugar was absolutely hammered after its recent earnings release, dropping more than 40%.
I can't claim to have done any of the research for this idea on my own, I just came across it literally five minutes ago, but I like what I've read about the situation so far.
Many of the company's problems seem fixable. While annoying, particularly for existing shareholders, Imperial's hedging losses are theoretically a one-time event. Sugar prices should theoretically eventually improve. The company's new plant is now operating much closer to full capacity than it was.
Look how cheap this company is relative to its book value. IPSU closed today at $9.86/share...less than half of its $20 book value. Sure book value is somewhat arbitrary because what is the book value for a sugar plant if prices don't recover, but that's a huge cushion.
Furthermore, it sounds like Imperial has a couple of new products in the works, including a mix with Stevia (my personal preferred artificial sweetener).
This is definitely an Interesting stock that warrants additional research.
Source: A Bargain Hunter's Dream: Imperial Sugar Goes on Sale
Deej
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