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Monday, 11/07/2005 9:52:21 AM

Monday, November 07, 2005 9:52:21 AM

Post# of 173880
SIMC $4.5 Up 28c BROKE $4.3 Resistance.

http://stockcharts.com/gallery/?simc

Simclar, Inc. (Nasdaq: SIMC) is a consistently profitable global contract manufacturer of electronic and electro-mechanical products.

Regarding 3Q 2005 and 4Q 2005, SIMC's Chairman Russell said on the 2Q 2005 release:

.."....The outlook for the company as a whole is good for the second half of 2005, and we expect sales and profitability to increase over the first half of the year."

Unlike other low-float microcaps, SIMC does not depend on one industry or ane big customer. SIMC has over a dozen plants and hundreds of customers worldwide. SIMC operates manufacturing plants in China, Mexico, Scottland, and six plants in the United States.

SIMCs geographical/product/customer diversification lowers the risk considerably. That is a big reason why SIMC is consistently profitable and has been profitable in 9 out of the last 10 years. Not many companies can make that claim.


+++++SIMC INVESTMENT HIGHLIGHTS:


* 1.8 Million Shares in Float
* Profitable in 9 of 10 years (2001 was the exception)
* 2004 most profitable year - EPS=$0.36
* Revenues of over $50million/year
* Added two new plants early this year
* 48% Revenue Growth. From $36M in 2003
* Market Cap only $24 million
* P/E = 15
* P/S = 0.45
* Insiders own 75% of the company.

REGARDING 3Q AND BEYOND:


SIMC Chairman Sam Russell commented upon the release of 2Q 2005 financial results on August 12:

"It is disappointing to report a decrease in sales in the quarter compared to the same period in 2004; however, this is caused by two of our plants in particular. One of these plants generated significant sales in the second quarter of last year due to above average demand from two of its customers. Unfortunately, there has been no such similar demand in the current year, with the result that sales for that plant have decreased by $707,000 (53%) in the second quarter of 2005.

"We... are pleased to note that this plant has now returned to profit and we expect it to remain profitable throughout the third quarter..."

..."The other plant in question has experienced a general decrease in business levels in the quarter, with the result that its sales are down by $808,000 (29%) in the second quarter of 2005. I'm pleased to say that, since the end of the second quarter, that plant has been successful in winning a significant order which will result in significant sales growth in the remainder of 2005 and on into subsequent years..."

...."The sales reductions at these plants decreased our profitability in the quarter..."


Based on the CEO's bullish comments about the 2nd half of 2005, SIMC may surprise the street with a record 3rd quarter next week causing another April-like explosion. Don't be surprised if the company reports 10c/share + net income. Why?

- The two plants that lost money and caused the 3c/share net income aberration in 2Q are and will be profitable in 3Q and at least 4Q.

- The company only recognized revenues for 2 months for its new plant acquired in 2Q 2005(SNA). One month of revenue from that plant amounts to half a million $$ and will show up in 3Q results.

- The new state of the art Matamoros plant started up in 1Q 2005 is gaining traction and will bring lots of revenue and net income.

- SIMC has invested considerable resources in the China plant/region this year. CEO expects huge growth in the region now and in the future.


ALWAYS DO YOUR DD BEFORE YOU INVEST.

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