BAMM
I brought around $2.20-$2.22. This will be a very small position, but I believe the book retailer is too cheap here in the low $2.20's. Here's why.
Balance Sheet: BAMM Trades at a deep discount to book. Yes pardon the pun here. Book Value is $6.28 on BAMM.
History of Dividends: BAMM pays dividends in 2005 they started paying .05 a share a quarter, now they pay .09 a share a quarter at an annual rate of .36 a share. Now originally the dividend yield was no bid deal, but with the huge drop in the stock price they are paying a dividedn Yield of over 16%.
Steady Long-Term Grower
Revenues
2006 503.751 Million
2007 520.416 Million
2008 535.128 Million
Although Revs will probably be down in 2009, this is a company that has executed when the environment was better. And even in this bad environment they remained profitable earning .10 in the first two quarters, and probably will be mildly profitable in the 3rd quarter. Q4 is where BAMM makes most of it's Profits although it will not Match last year.
Even if Revs are 155 Million
Even if Margin are 32%
Even if Costs are 35.5 Million
Interest Expense at 500k
Taxes at 38%
EPS will still come in at .54 for q4, so .60-.75 for the Year is very possible, which mean the dividend Yield is safe until the growth returns.
I do not like Retail, and would not own a retail play, but BAMM is paying me big to simply wait, and I believe the dividend is safe and it will Trade at 3 or so time fiscal 09 earnings, so I believe BAMM is very attractive in the 2.20's. Just my opinion.
AI
