Replies to post #126534 on Savvy Trades and Investments

[researcher59]

SSK - I'm glad that you found some stocks to buy with your huge cash horde. Are you no longer concerned about a broader market correction looming in the coming weeks ?

[SSKILLZ1]

BAX

Brought some BAX at $22.14 today, so obviously went lower after I brought it. but here is what I like.

1) Current has a yield of 3.1%+ at current prices. So you get paid a decent yield.

2) Company guidance of $2.42-2.52, and I expect decent earnings growth next FY hence I believe the stock is simply too cheap. I think at least a 12x multiple is warranted and perhaps as high as 15. I expect about $2.70-2.80 next FY hence I see significant upside from current prices.

Conclusion: I like BAX here and think it is a pretty good buy at current levels which is very close to 52 week lows. I will buyback more on weakness. Time will tell. All is just my opinion, and I could always be wrong though.

[SSKILLZ1]

PRTH

Brought some PRTH today at $6.89, this payments plays I find super attractive here. Here's why.

1) PRTH last quarter reported .26 versus .11 in the year ago period. In q1 they reported .22 versus .03. So through 6 months ended .48 versus .14 in outstanding EPS growth in my opinion. Based on guidance I expect .55-.65 eps in the 2nd half which will once again show impressive comps which should put earnings for the year in the $1.03-1.13 this FY, I expect continued earnings growth probably $1.25-1.30 in the next FY Conservatively. All of this for about 6x this years earnings with great growth. I think PRTH deserves at minimum a 10 PE which could put fv in the $12-13 range over the next year.

2) PRTH is also growing revs solidly. this is not just and earnings story but pretty solid top line growth of 10.2-12.5% is being guided for which is also a plus. But this growth has been going on for years here. So as you can see by the numbers below these guys consistently have been growing revs which is a significant plus.

FY 21 515 Million
FY 22 664 Million
FY 23 756 Million
FY 24 880 Million
FY 25 970-990 million Estimated.

Conclusion: I like PRTH which in my opinion is a very good growth story in the payments space at a very attractive valuation, which is trading in my opinion a significant discount to what I believe Fair Value is. Will add more on weakness. All is just my opinion, and I could always be wrong though.

[SSKILLZ1]

THS

Brought THS at $15.99 today, here is why I like this food play.

THS earned .17 last quarter and .20 so far through 6 months ended. I expect sales growth to possibly turn positive as early as q3 but definitely by q4, with further sales growth expected in the next FY. Based on Analyst estimates they are expected to earn $1.76 this FY and Analyst estimates are for $2.08 in the next FY. That might be a bit optimistic but I do expect EPS to grow decently over the current FY. I expect a 12 multiple conservatively if they do around $2.00 next year I see a scenario where the stock FV is around $24.

THS is an attractive entry point as your getting this beaten up stock at 52 week lows, these guys use to trade at 15x-20x easily, now they are trading at 7-8x next years estimate. hence a cheap historical valuation at 52 week lows seems like a good entry point for me.

THS is a maker of private brands, I believe private brands in the food aisle are gaining market share over branded products which is one of the main reason why I like this one as well. This stock fits my investment thesis of private brands gaining market share over branded products and this is a way to play that at a very attractive valuation and with earnings growth turning positive soon and into next year I think that will be the catalyst for this stock to return to more historical norms on valuation metrics for the company.

Conclusion: I think THS is an attractive investment opportunity here at 52 weeks lows, a way to play private brands which I truly believe could be a thorn in the side of many branded products in the staples space. I also expect earnings to start to show improved numbers in the coming quarter and show decent earnings growth in the next FY. Time will tell. All is just my opinion, and I could always be wrong though.

[SSKILLZ1]

SSKMP Trades

Sell 500 Shares of THS

Note that this is a fictional portfolio and is not a recommendation to buy or sell securities