Target Logistics (TLG)

[slow_feet]

scubavol,

I've been taking it easy for 4-5 months, but starting to do some work again. Regarding TARG:

According to the last earnings PR, the negative impact on Q1 earnings were attributed to the Discovery acquisition:

"As a result of the performance of our Discovery Acquisition concluded in July of 2006, our New York Station's profitability compared to the first quarter of fiscal 2006 was negatively impacted. We are taking steps to improve the performance of the Discovery acquisition and believe it will become a positive contributor in the near future."

TARG, historically, has shown they know how to absorb acquisitions rapidly and successfully, so its probably only a short term problem. Although they also have the recent Capitaland Express acquisition from October to deal with as well. How these two factors will impact Q2, ending 12/31/06, is a matter of concern.

The end of year quarter, Q2, has always been their strongest quarter with unusual jumps in revenue and earnings, so we can probably expect next Q's earnings to be strong. Couple this with tax-loss selling due to this year's wild ride over $5 pps, and there will probably be an opportunity in the next 3 weeks to pick up some shares. That's what I plan to do, especially if it has a dramatic break.