Friday, July 18, 2014

Richardson Electronics: Back in Net/Net Land

It's the slimmest of pickings this day in the net/net land, a place that no publicly traded company would go by choice. With just three U.S. companies with market caps in excess of $100 million currently trading below net current asset value, Richardson (RELL) appears to be the best of the bunch. The others are Trans World Entertainmant (TWMC), and Imation (IMN).

Richardson currently trades at just .86 times NCAV, and the quality of the balance sheet is excellent, including $130.5 million, or $9.30 per share in cash and short-term investments.Considering the company's current $10.23 price, that's compelling. The company has no debt, and trades at .81 times tangible book value, and currently yields 2.4%

While still profitable, which can sometimes be uncommon for net/nets, revenues and profits have been sliding.

Richardson is scheduled to report fourth quarter and full year results on July 23rd.We'll be particularly interested in whether the company has maintained or grown its cash and short-term investment balances.

Richardson Electronics (RELL)
Price: $10.23
Market Cap: $143.5 million
NCAV: $166.3 million
Mkt Cap/NCAV: .86
Cash: $97.2 million
S/T Investments: $33.3 
Tangible Book Value/Share: $12.56P/TBV: .81
Trailing P/E: 85
Dvd Yield 2.4%

 *The author has a position in Richardson Electronics. This is neither a recommendation to buy or sell any securities. All information provided believed to be reliable and presented for information purposes only

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