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July 6, 2010 52-Week Low Wrap-Up: Tejon Ranch, Northwest Pipe, Nucor, Monsanto, Knight Capital, Hercules Offshore, Seahawk Drilling, Cowen Group, Century Casinos, Alliant Techsystems

Patrick Goldin

Patrick Goldin

2 followers
Today, 204 companies’ share price reached a new 52-week low. Of these companies, these are the ones that look interesting based upon my preliminary research.

Alliant Techsystems (ATK)

Alliant Techsystems manufactures weapons, ammunition, and space systems for the U.S. government and allies. It operates in four divisions: aerospace systems, armament systems, missile products, and security and sporting. The company employs more than 17,000 people in the U.S. and internationally. Alliant is the leading supplier of bullets to the U.S. military, and the producer of the rockets found on NASA's space shuttles.

Century Casinos (CNTY)

Century Casinos owns and operates casinos in Colorado and South Africa, as well as runs casino operations for the Millenium Casino in the Czech Republic. The company's original casino, the Womacks Casino and Hotel in Cripple Creek, Colorado, is the company's core operation. Century Casinos also has long-term agreements with three global cruise ship companies to operate multiple casinos aboard their cruise ships.

Cowen Group (COWN)

Cowen Group is an investment banking firm whose history can be traced back to 1918. In 2009, the company merged its investment banking business with asset-management firm Ramius. Cowen primarily provides investment banking and brokerage services to small- and mid-cap companies in seven industries: health care, technology, telecommunications, alternative energy, consumer, financials, and aerospace and defense.

FBR Capital Markets (FBCM)

FBR Capital Markets is an indirect taxable REIT, a subsidiary of Friedman, Billings, Ramsey & Co, which is a full-service investment banking, trading, research and asset management firm. By separating the capital markets and asset management businesses, FBR Group created FBR Capital Markets to allow investors to invest in the capital markets business at FBR.

Seahawk Drilling (HAWK)

Seahawk Drilling operates a jackup rig business that provides contract drilling services to the oil and natural gas exploration and production industry in the Gulf of Mexico. As of December 31, 2009, the Company’s fleet of mobile offshore drilling rigs consisted of 20 mat-supported jackup rigs that are capable of operating in maximum water depths of up to 300 feet and drilling to depths of up to 25,000 feet. The Company contracts with its customers on a day-rate basis to provide rigs and drilling crews. Seahawk’s customers primarily consist of various independent oil and natural gas producers, drilling service providers and the national oil company in Mexico, PEMEX. Effective August 24, 2009, Seahawk was spun-off from its parent company, Pride International. As a result, Pride no longer retains any ownership interest in Seahawk.

Hercules Offshore (HERO)

Hercules Offshore is an offshore drilling company with a variety of jackups, barges, and liftboats. Its operations are primarily focused on the Gulf of Mexico shallow-water market. Its customers are mainly independent oil and natural gas exploration and production companies.

Knight Capital (KCG)

Knight Capital Group provides electronic and voice financial security trade execution services to buy-side, sell-side, and corporate clients as a market maker, agent, and electronic execution provider.

Monsanto (MON)

Monsanto is one of the world's leading providers of agricultural inputs, including seeds, biotechnology traits, and herbicides. The company has a presence in more than 100 countries and generated $11.7 billion in sales during its fiscal 2009. The firm's seed and genomics segment generated 67% of companywide gross profit in 2009, while the herbicide segment contributed 33%.

Nucor (NUE)

Nucor operates 23 scrap-based steel mini-ills in North America, producing flat-rolled and long products as well as downstream steel products such as steel joists, girders, and decks. The company is also the largest U.S. scrap processor and broker. Nucor primarily serves manufacturers, steel service centers, and fabricators in North America, although exports are becoming a larger component of the company's sales.

Northwest Pipe (NWPX)

Northwest Pipe manufactures pipes and tubes. The company's water transmission segment manufactures and markets large diameter, high pressure welded steel pipes used primarily for water transmission and treatment in North America. The tubular products segment manufactures electric resistant welded steel pipes for use in construction, agricultural, and industrial applications. The company also manufactures traffic signpost products and propane tanks. The company has not been able to file its two most recent required reports due to an ongoing internal investigation of certain accounting matters, including certain revenue recognition practices. The last report it filed was on August 7, 2009. Northwest's CEO resigned on April 2, 2010 and the company’s President has assumed the role.

This is all evidence that points to serious mistakes, real fraud, negligence, ineffectiveness, or all of the above. Given all the above, the current share price may represent an excellent opportunity for purchase given the potential for forced or irrational selling due to the company’s inability to timely file its required reports.

Since investors have not seen a balance sheet or income statement for slightly over nine months, there is a large amount of uncertainty surrounding the value and the company and therefore the company should be valued by tangible book value or on a liquidation value. From their balance sheet as of June 30, 2009, the tangible book value per share is $29.43.

Stewart Information Services (STC)

Stewart Information Services provides title insurance and settlement-related services. The company operates in all 50 states, closing transactions and issuing title policies on homes and commercial real estate properties. The company also provides real estate information services and data such as mapping products and geographic information systems.

Tejon Ranch (TRC)

Tejon Ranch owns around 270,000 acres of land north of Los Angeles. Although at one time used almost exclusively for agricultural purposes, the majority of income is now earned through transactions related to real estate. The company owns and operates an industrial complex on the land, which leases space to industrial and commercial users, as well as ranching and recreational facilities. Agricultural operations still produce significant portions of revenue, earned through the sale of fruits, vegetables and nuts to commercial buyers

Disclosure: The author holds shares in Cowen Group (COWN)

About the author:

Patrick Goldin
Patrick Goldin is the General Partner of the Alain Value Fund LP, a limited partnership exercising a value-focused and bottom-up securities approach. In addition to his duties as general partner, he is a student in high school. He can be reached at patrick.goldin@alainvaluefund.com

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