Friday, February 24, 2006

What car would Benjamin Graham drive?

SPF, BDG, STTX fit into BGs stock screener as of Feb 15/2006.

Of the last 3 picks (STTX, SXT, ROCK) two rose since Sept. (SXT went down, Rock and Sttx rose.)

Standard Pacific Corp builds houses and provides mortgages. Hmm.. bubble?
Plus the CEO made almost $13M dollars! That's more than some bank CEOs make!

SPF's home prices in 2004 ranged from under $100,000 to over $1 million. In 2005, 2004 and 2003, the average selling price of the company's homes, excluding sales of unconsolidated joint ventures, was $347,000, $374,000 and $307,000 respectively.

So it looks like the markets peaked in 2004?

Let's check out BDG.

Bandag Inc. produces and sells tires. A growth stock if I have ever seen one. Last time I bought tires I only had 3 options, expensive, expensiver, and expensivest. When I tried to put tires on my Hyundai Tiburon, I found out that there was only 1 model in town, and each tire was... $385.00. While I was getting them installed, a man came into the tire dealership driving an AMG S55 He was in his late 30s, and coincidentally went to school with another couple who were there at the time.

Turns out that he was a broker on Bay St. His Porsche was stolen a few months ago from his driveway after a home break-in, and he decided to go with a nice AMG-S50.

With a top speed of over 145 mph, it needs good tires.

He went to Mercedes for a quote, and his winter tires would have cost $4,000. I think that included balancing and installing, but I'm not sure.

Put my piece of crap Tiburon tires back into perspective. It would have been cheaper for him to buy my car, drive it for the winter, and then give it to the poor. Maybe not, because of the insurance premiums, plus the fact that it was the most stolen car at the time so it probably wouldn't have lasted too long in his driveway.

So back to this stock. The CEO, Mr. Martin G. Carver, is paid fairly for his 817M market-cap company, at under $600k. He probably isn't driving an AMG. Maybe a Porsche. Or a Hummer. The franchise they bought in 2004 is SpeedCo, haven't seen any of those around here. They're based in Iowa, isn't that near Omaha? Well they rhyme, so maybe that's a good sign.

Only 19M shares outstanding according to Yahoo, compare that to a Barrick total of 500M. Hmm. NYSE tells me there's 9M shares. What's going on?

So much for growth, it's down 3% over the year. Maybe it will come back, but with a spread of $42-$47 it probably won't make you much? P/E is 16.5

STTX has been on the list twice now, does that mean that instead of a Value stock it is a Valueless stock? Comparing the charts to BDG show that it may have some growth potential, but was really tanking last year. It is much more consistent than BDG. Huge growth since the bubble burst in 2000.

What does it make?

(What's that clanging noise coming from the Far East? The sound of all the buildings in New York being built in Shanghai, in 1 YEAR)

Its processed products include cold-rolled strip and sheet, cold-rolled one-pass strip, high carbon and alloy strip and sheet, hot-rolled sheet, high strength low alloy strip and sheet, coated strip and sheet, and hot-rolled pickled and oiled sheet and tin plate.

Mmmm. hot-rolled pickled and oiled sheet sounds like something from the $3.99 Chinese lunch special I used to eat.

The business sure sounds exciting! The CEO made almost double what BDG's made. He is probably driving the heaviest, steeliest car around.

Ha! Gold-plate your Delorian so that the frame won't rust out every 3 years.

Visit the ultimate Delorian site on the web.

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