Savvy Trades and Investments

[littlefish]

SWICK, take a long look at OPXS. I'd probably see where Q4 comes in first since it should be out by year's end (possibly this week). I'm guessing $.05-.07 op income per share.

Their share structure and debt got massively cleaned up first in Aug 2016 (convertibles cleaned up) and most importantly in June 2017 when over $13 mill in debt owed by Sileas (and pledged in shares of OPXS making the debt owed potentially toxic to me as a potential investor) got cleaned up.

Now pretty much all those parties are only common shareholders like me except SILEAS/Hirschman whom no longer own any.

There are two positive organic growth drivers along with the whole business about to start perking up. One is more immediate with their building relationship on the commercial/retail side and the other involves a replacement build for the M113 military vehicle that will get going down the road a bit more probably (like a year or two). I estimate the latter could add upwards of $3 mill per year in periscope sales when AMPV goes into full production after 2020 and could add roughly $1+ mill once low rate production starts probably in late 2018 or 2019. That compares to total periscope sales of around $7.8 mill last year I think. So double digit organic growth potential eventually (the AMPV has only had a few testing variants built so far so it hasn't had meaningful impact on sales yet).

My guess is there's a bit of selling pressure lately into year end. Longview registered to sell up to 1.3 mill shares not long ago when the debt was settled. Keep in mind, the 2016 share restructure was for $1.2 per share when the company was worse off IMO. Subtract 4 cents in divs paid so their cost basis would be $1.16. We can buy shares a bit over $1. Not to mention the debt settlement averaged out to something like $3.7 a share for Longview since they forgave a big chunk of the debt. So the company's value was immediately enhanced in my mind.

The company has fairly stable SGA overhead and fairly stable fixed costs so they can leverage growth and turn it more easily into meaningful cashflow IMO. They made a couple small smart acquisitions over the last 5 years- buying remaining pieces of Miller-Holzwarth in BK for $750k- they used to be a direct competitor in plastic periscope market, and picking up AOC in Dallas from L-3 in the middle of sequestration hell for some of these small companies for about $1 mill (AOC should do over $5 mill revs this year and are hitting critical mass to pay overhead and expand profitability).

The puttable warrants for cash also mask a bit of book value IMO and at first had me cautious about what implications they might mean, That puttable for cash clause is tied to their being a fundamental transaction (like change in ownership/merger/buyout,etc). This probably makes the company a bit less attractive as a buyout candidate but also if warrants get exercised brings in about $1.5/warrant in cash- so effectively it would benefit us buying shares near $1 if they get exercised at $1.5 so the dilutive factor is accretive to peeps buying at this level. Took me awhile to get comfortable with the puttable part til combing over the S-1/A form where detailed info was. Thinking it was filed Aug 26 2016 or something like that if U dig.

I've spent some time combing over it due to not feeling comfortable with them for a long time but I feel pretty good about their future right now. Especially if you look out a few years (the near term looks OK too but I think the AMPV could really juice periscope sales down the road).

I've accumulated from the low $0.9s to just under $1.1 area and continue adding.

Good luck and don't be afraid to keep digging to assuage any fears/answer questions you might have. I think that's one reason they haven't been discovered yet.

All IMO only.