American Greetings Corp (NYSE:AM)

Out of business in 5 years!!! Ouch!

Standing offer to purchase the company at a higher than current per share price.

I hope they are not bought up, because they have new
programing going on with both their Strawberry Shortcake and Care Bears products

Stock is selling below the Chairman's takeout offer. A little arb "play" here (that I'm not suggesting anyone put real money behind). I think something will get done that moves the deal higher.

A tenmiles pick, looks like attractive long-term prospects here with enough cash to cover debt, low payout ratio, and attractive valuation metrics including P/B and PEG.

piotroski screen

AAPL alert

American Greetings, AM, is a company with an obsolete product. The company sells greeting cards and related supplies such as wrapping paper and gift bags. The greeting card product must eventually lose out to the online delivery of such cards. How much wrapping paper does it take to wrap an ebay gift card, an mp-3 or a Netflix subscription? These cards and wrapped gift must depend on the cheap service available through the US Postal service, but the USPS’s financial woes will cause USPS to raise service rates, reduce services offered or both. This combination of obsolete product and obsolete product delivery will limit sales of physical cards, wrapping paper and stationary.

AM has an internet card subsidiary, Blue Mountain Cards to preserve some revenue as consumers move from physical to online delivery of cards. This business has a very low barrier to entry and one can easily imagine the effect of “Google Cards” or “iCards” on the Blue Mountain Card business.

AM has a limited upside. AM’s revenues have been stagnant for 5 years. AM has managed to grow profits by reducing material, labor and marketing costs but there is a limit to how far these can be cut before perceived product quality is affected. The upside on AM is limited by their recently completed systems refresh which has yet to be reflected in the balance sheet. The CEO has said that the systems refresh cost will be lumpy, which I assume to mean it will be shown as a one-time item against profits.

Disclosure: No position at this time.

well positioned for good solid growth in the coming years.

You know,
I still purchase cards. Go in any grocery or pharmacy and they usually have a whole isle dedicated to greeting cards and related products. And American Greetings hasn't slashed it's dividend but increased it earlier this year.

Look for continued profit taking over the next 2 months.

Solid company that has been like a bulldog throught recession and is still continuning to grow, and good management that adjusts company's business strategy with ever changing times.

zzzzmn74

Its cards.....

a good greeting cards company

keep it no matter what

Gift cards will always be here. And they dominate that business. Like Warren Buffet says, "Buy what you know."

Very attractive price in down economy makes gift cards a better present than durable goods.

The Company creates, manufactures and distributes social expression products including greeting cards, gift wrap, party goods, calendars and stationery as well as custom display fixtures.

Making the turn earnings.