MVCO
I just wrote a long post on MVCO and it disappeared. Actually I thought I was editing my last one word post during the 15 minute edit period, but maybe I spent more thatn 15 minutes editing it. Anyway, MVCO is one of my PSL3 picks and my largest holding and I was surpised that MVCO was picked by only one other VMCer. Maybe I should not be surprised since I only expect a 30-50% gain during the contest, and most VMCers have picked stocks with higher growth expectations for the contest. Why do I like MVCO?
1. It is in a stable growth industry and operates in two high growth states, Arizona and Nevada.
2. It has $4.64 of stockholder equity including $4.06/share of cash.
3. It owns (53%) 2,025,000 shares of ReadyMix Inc., an aggregate/cement construction company that operates and is growing in the same area.
4. At current $15.23/share price of RMX, the RMX shares owned by MVCO are worth $6.88/diluted share of MVCO.
5. The cash and value of RMX shares equal $10.94/share, which is higher than the $10.70 closing price of MVCO.
6. While Q1 construction backlog declined a few million, the company expects to announce additional contract wins in the near future.
7. I think MVCO can earn $.20 to $.30 per share fully taxed each quarter going forward.
8. I expect topline and bottomline revenue growth to get this stock noticed and possibly become a low float mover.
Those are my reasons for liking this value microcap and I am sticking with them.
Tmcal
