DST Systems, Inc. (NYSE:DST)

CAPS Rating: 5 out of 5

Provides sophisticated information processing and computer software services and products to the financial services industry, communications industry, video/broadband/satellite TV industry, healthcare industry and other service industries.


Player Avatar noname25 (72.48) Submitted: 8/24/2006 8:43:27 PM : Outperform Start Price: $53.37 DST Score: +9.15

DST has a number of private minority-owned subsidiaries that are difficult to value and thus ignored by the market. Once they, and the public securities, are extracted from the overall enterprise value you have a company trading for approximately 10x FCF to equity that is more properly valued at 20x. Seems 75% cheap. Management appears to agree, buying back more that half the float over the past few years in the open market.

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