Savvy Trades and Investments

[2morrowsGains]

STCN...One for the watch list...Interesting company that is either hugely undervalued or I'm missing sometihng. Here's the skinny...

STCN: Steel Connect, Inc. is a publicly-traded diversified holding company (Nasdaq Global Select Market symbol "STCN") with a wholly-owned subsidiary, ModusLink Corporation, that has a market-leading position in supply chain management.
https://www.moduslink.com/ .
Steel Connect shows a HUGE cash position and a low share count with not too much debt.
Current Market Cap: $56M
Cash & Equiv: $276M
Cash Per share: $44.33
Total Debt: $38.8M
Shares Outstanding: 6.3M
Float: 2.4M
Insider Ownership: 30%
Institutional Ownership: 48%
The Company had net NOL carryforwards for federal and state tax purposes of approximately $369.9 million and $138.8 million, respectively, at July 31, 2023.
Current Share Price: $8.70 ($8.60 x $9)

Anyway, I've been slowly accumulating shares in STCN over the past couple weeks.
Steel Connect (ModisLink) looks undervalued but I need some help. Hopefully others here (anyone?) can take a peek at the company and tell me if or what I'm missing (if anything). I really don't want to loose my ass on this one if I'm wrong.

The thing that's boggling me is the Series E Convertible Preferred Stock.
The Series E, if converted, would bring the fully diluted share count to approx $26M share outstanding but would add a nice amount of cash to the balance sheet if I'm correct?. Am I correct??
The one negative I have is they rarely release news and have no cc's.
Hope to hear an opinion or two on this company...

From the 10 Q (page 26)...
"On May 1, 2023, the Company and Steel Holdings executed a series of agreements in which the Steel Partners Group agreed to transfer certain marketable securities held by the Steel Partners Group to Steel Connect in exchange for 3.5 million shares of Series E Convertible Preferred Stock of Steel Connect"
"Following approval of the Nasdaq Proposal by the Steel Connect stockholders (the “Stockholder Approval”), the Series E Convertible Preferred Stock became convertible into an aggregate of 19.8 million shares of the Common Stock, and votes together with the Common Stock and participates in any dividends paid on the Common Stock, in each case on an as-converted basis."

From the 10Q (page 37)...
"Any holder of the Series E Convertible Preferred Stock (“Holder”), may, at its option, convert all or any shares of Series E Convertible Preferred Stock held by such Holder into Common Stock based on a conversion price of $10.27 (the “Conversion Price”) per share".

Latest News...
Moduslink Corporation Announces Expansion Into Thailand
https://moduslink.com/news/moduslink-corporation-announces-expansion-into-thailand
ModusLink Corporation Earns Intel’s 2023 EPIC Distinguished Supplier Award
https://www.moduslink.com/news/moduslink-corporation-earns-intels-2023-epic-distinguished-supplier-award/

ModusLink is an end-to-end global supply chain solutions and e-commerce provider serving clients in markets such as consumer electronics, communications, computing, software and retail. ModusLink designs and executes critical elements in its clients’ global supply chains to improve speed to market, product customization, flexibility, cost, quality and service. These benefits are delivered through a combination of industry expertise, innovative service solutions, and integrated operations, proven business processes, an expansive global footprint and world-class technology. ModusLink also produces and licenses an entitlement management solution powered by its enterprise-class Poetic software, which offers a complete solution for activation, provisioning, entitlement subscription, and data collection from physical goods (connected products) and digital products. ModusLink has an integrated network of strategically located facilities in various countries, including numerous sites throughout North America, Europe and Asia.

STCN's latest 10Q
https://app.quotemedia.com/data/downloadFiling?webmasterId=90423&ref=317925943&type=HTML&symbol=STCN&cdn=cdda6eab612d1b4782f68846ceb63c97&companyName=Steel+Connect+Inc.&formType=10-Q&formDescription=General+form+for+quarterly+reports+under+Section+13+or+15%28d%29&dateFiled=2023-12-14