Value Microcaps Motherboard

[whyme2005]

EXXA $4.24. Pre-earnings rally continues relentlessly. 6-month target: $15++.

http://stockcharts.com/gallery/?EXX/A

A few reasons for the rally?? High expectations coupled with recent awareness that EXXA even existed. 60 - 80c/share annualized net income.....trading at 0.25 P/S.....solid balance sheet with $1.3/share cash....float of only 4.7M shares.

EXXA is starting to to move up ahead of another huge quarter to be reported in about three weeks. EXXA will likely make an annualized 60 - 80c/share net income due to two major long-term contracts with DaimlerCrysler and the recent acquisition of profitable vinyl wallpaper maker Sellers & Josephson from Chapter 11.

In August 2006, EXX Inc. (AMEX: EXXA...or EXX/A or EXX.A) reported an impressive 19c/share net income on $43M in revenues (about 20% revenue growth) for 2Q 2006.

Take a look at EXXA's steady improvement quarter after quarter.

http://finance.yahoo.com/q/is?s=EXX-A

EXXA has a strong balance sheet with $1.3 in cash and a rapidly diminishing long-term debt having been reduced three-fold in the last 3 years:

http://finance.yahoo.com/q/bs?s=EXX-A

DaimlerChrysler has recently become EXXA's largest customer due to two significant multi-year contracts amounting to about $45M in revenues. The new DaimlerChrysler's contracts will represent about 25 % of the total projected $160M - $180M/year EXXA revenues in 2006.

Regarding the two DaimlerChrysler contracts (Per the 2005 10-K) :

..."In May 2005, the Company reported that one of the subsidiaries of Newcor received purchase orders from Daimler Chrysler Corporation ("DCX") to machine axles for two current powertrain programs. the anticipated sales would approximate a 20% increase over the Company's then sales and profitability on an annual basis..."

.."In June 2005, the Company reported that a second subsidiary of Newcor had been awarded a machining program for a DCX powertrain. The annual sales of this program were estimated at approximately 10% of the Company's annual sales..."

Another factor for EXXA's big jump in revenues and profitability is its recent acquisition of vinyl wallpaper maker Sellers & Josephson (S&J) from BK for $4M. S&J was a division of Falcon Products, which went bankrupt, but S&J was making money. In short, EXXA bought a profitable company for less than net tangible assets.

The most difficult part about investing in EXXA is to figure out the symbol used by the various brokers. Etrade and Ameritrade use EXX.A..........Scottrade uses EXX/A..... MerrillLynch uses EXX'A.

EXXA was a $6+ stock in 2004 with less revenues, less earnings, and three times the long-term debt. More importantly, EXXA did not have a blue chip company like DaimlerChrysler as its largest customer.

It is obvious that EXXA's Chairman/CEO David Segal is very bullish about the future of EXXA's stock. He has recently added 102,700 shares to his 5M plus shares buying all those shares in the open market!!


EXXA HIGHLIGHTS:

* LOW FLOAT = 4.7 MILLION SHARES

* 2006 ESTIMATED REVENUES: $170 MILLION...25% GROWTH

* 2006 ESTIMATED NET INCOME: 50 - 60C/SHARE

* ESTIMATED FULL YEAR NET INCOME: 60C - 80C/SHARE

* MARKET CAP = $36M

* P/S RATIO = 0.25

* O/S SHARES = 11.3 MILLION

* MARKET CAP = $44 MILLION

* INSIDERS OWN 54% OF COMPANY


ABOUT EXXA:

Newcor, EXXA's largest division, was founded in 1933 as National Electric Welding Machines Company and changed its name to Newcor in 1969. EXXA snatched NEWCOR from BK in 2003........

Newcor, Inc., owns several divisions employing over 1000 people worldwide in all areas of design, engineering, and manufacturing for the automotive, heavy-duty, agricultural, industrial, and defense markets...........