Buckeye Technologies, Inc. (NYSE:BKI)
The Company manufactures and distributes value-added cellulose-based products used in disposable diapers, personal hygiene products, engine, air and oil filters, concrete reinforcing fibers, food casings, cigarette filters and rayon filaments etc.
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Overly punished for a bad quarter
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Improving fundamentals. ROA and Gross Margin improving yoy.
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economic normalization, staple stock
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Has good financial. Debt load as decreased in the current economy. They seem to have a handle within their area of expertise. Certainly worth watching.
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Found this with a simple screen for five star stocks with earnings, then sorted for low PE (thanks again TMF!). Buckeye is about to join my real world portfolio when the market opens on Monday. Their simple focus on high-end, specialty fiber products has the hallmarks of a great long term investment, and right now seems like the time to buy. PE is around 3 now, and for the last year, earnings have been strong.
Their products are manufactured from basic materials, so they are dependent on energy, timber, and cotton prices, however their finished products are extremely useful and many are things people need in good times or bad. They make the materials for diapers, feminine hygeine products, cigarette filters, LCD screen materials, concrete additives, hot dog casings, and many other strange and wonderful products that you probably never realized were made from trees. I like management's straightforward 10K filing from last year, and learned a few things reading it. If you're thinking about investing in this one, take the time to read it and know what you're getting into.
The company is small and specialised. Their sales force is very technical, and they have few competitors in their markets. They believe they can be best at their simple business plan, and I think that's a reasonable goal. Profits should flow from there.
I like that during 2009 they reduced officer compensation but held salaried worker salaries steady. They lost money in 2009, during the downturn, so those were reasonable things to do. Long term debt is fairly sizeable, but they are paying it down from cash generation at a good clip. Overall, I really like this company. It is in both a boring and a distasteful industry, and as far as I can tell, only 3 analysts are following it now.
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up 25% in this stock in my real portfolio but im just adding this to caps now. it needs to break through resistance at the near the 12.45 level and then this baby should take off. i think it could be priced fairly between 16-18 within the next 1-3 years, currently undervalued despite move yesterday, but this stock has been extremely volatile so you can time your entry point after a move down. (maybe in the 5% neighborhood if you want to risk waiting for a pullback)
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Demand for materials will increase as manufacturing rebounds.
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BKI manufactures and distributes cellulose specialty products. It is a well managed and strong Ohio company that is recovering nicely from a rough period, and it is undervalued.
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up 85% in 3 months, overdone
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BKI, a company with diverse products, has been improving its financials despite current challenges in the economy. Revenue growth, EPS, net income and cash flow have all improved over the last quarter. The company still needs to improve on ROE, ROA & ROI and it would benefit from debt reduction. However, it appears to be headed in the right direction. Given that BKIs price to book is currently .88 and given that is currently trading at $9.55, well off its 52 week high of $19.20, and given the recent improvement in financials, this company is poised to outperform.
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A lot of insider buying at $9.0
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Poor management, plain and simple. There is also no real reason why this company would face any significant growth that would cause it to outperform.
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