Educational Development Corporation (EDUC)

[wadirum1]

I agree that $300M seems like a stretch. Even if the demand is there, it would be hard for any company to ramp that quickly.

But even if they only do HALF that, but get back to 7 percent margins, we have 0.07*150M = $10.5M. Divide by 4M shares and we get about $2.50 per share or a P/E of 3.

A P/E of 3 is absurdly low. And I'm using numbers below their worst-case scenarios.

If we want to let our imaginations run, then try 10 percent margins on 300M in revs... Earnings would be larger than current market cap. I remember when I was buying FRPT at less than the cash they had on hand. Those sorts of cases do indeed occur from time to time. But even at a forward P/E of 3, this is a screaming bargain.