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Company name Republic Airways Holdings Inc.
Stock ticker RJET
Live stock price [stckqut]RJET[/stckqut]
P/E compared to competitors Good

MANAGEMENT EXECUTION

Employee productivity Poor
Sales growth Fair
EPS growth Poor
P/E growth Good
EBIT growth Poor

ANALYSIS

Confident Investor Rating Poor
Target stock price (TWCA growth scenario) $8.87
Target stock price (averages with growth) $10.5
Target stock price (averages with no growth) $9.06
Target stock price (manual assumptions) $10.71

The following company description is from Google Finance: http://www.google.com/finance?q=rjet

Republic Airways Holdings Inc. is a holding company. The Company offers scheduled passenger services through its wholly-owned operating air carrier subsidiaries: Chautauqua Airlines, Inc. (Chautauqua), Shuttle America Corporation (Shuttle), Republic Airline Inc. (Republic Airline) and Frontier Airlines, Inc. (Frontier). As of December 31, 2011, its operating subsidiaries offered scheduled passenger service on 1,483 flights daily to 132 cities in 42 states, Canada, Mexico, and Costa Rica under Frontier operations as Frontier and through fixed-fee code-share agreements with AMR Corp., the parent of American Airlines, Inc. (American), Continental Airlines, Inc. (Continental), Delta Air Lines, Inc. (Delta), United Air Lines, Inc. (United), and US Airways, Inc. (US Airways). The Company took delivery of eight A320 aircraft, two E190 aircraft, placed into service three A319 aircraft, sold five A318 aircraft, four of which have remained in the fleet under sale leaseback agreements.

 

 

Confident Investor comments: At this price and at this time, I do not think that a Confident Investor can confidently invest in this stock.

If you would like to understand how to evaluate companies like I do on this site, please read my book, The Confident Investor.
For owners of my book, “The Confident Investor” I offer the following analysis (you must be logged in to this site as a book owner in order to see the following analysis). If you have registered and cannot see the balance of this article, make sure you are logged in and refresh your browser.
[s2If current_user_can(s2member_level1)]
In order to assist you in using the techniques of this book, the values that I used when calculating the Manual pricing above were:

Stock price at the time of the calculation: $12.19

Growth: 0.07

Current EPS (TTM): $1.23

P/E: 10

Future EPS Calc: $1.72

Future Stock Price Calc: $17.25

Target stock price: $10.71

I hope that this makes you a better investor. [/s2If]

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The book value of a company is the total assets on the balance sheet minus the liabilities. This is the net worth of the company. It’s what shareholders actually own. If the company suddenly closed its doors tomorrow and paid off the debt, this is the amount of money that would be left to pay you and your fellow shareholders.

Some investors will look at the book value compared to the stock price. If the stock price is higher than the book value, it could be overpriced. However, realize that stock prices may factor in what some investors believe are the future earnings and performance of the company. The stock price is also subject to the herd mentality of owning a stock. Book value simply looks at current assets.

A stock trading less than its book value doesn’t necessarily mean it is a bargain. Book value does consider future earnings or the expectation of great performance.

I almost never talk about the book value of a company when I do my stock analysis on this site. I find it to be a metric that makes little sense when taken over the course of time. To me, it is more important to see if a company consistently performs well; as that is a great indicator that it will continue to perform. Just as when you hire a new employee for your firm, you hire that person because you feel s/he has performed well in the past and you expect that performance to continue into the future.

Book value tends to be important for a single point in time and not a trend that continuously gets better or worse. So if you believe in the notion of consistent performance in the past means that future performance is likely, then the book value has diminished importance. As I have tweeted many times under @ConfidentInvest, past performance may not be a perfect tool for predicting the future, but it is the best tool that we have at our disposal.

This is why book value rarely matters; the value of future performance is typically a far bigger driver of a stock price. Share prices of companies regularly exceed book value when investors believe that there is some confidence of future performance.

There are times when book value can be a signal for a good bargain. During the financial crisis of the 2007 and 2008, Goldman Sachs [stckqut]GS[/stckqut] had a book value in the mid $80 range. At its low in that time frame, it was trading at about $50. This was due to concern about its ability to have future earnings as a company. The herd mentality of the company drove the stock price down. If you bought at that price, you could have made a nice profit. This profit would have been realized even though Goldman may not have been a Good Company at that time.

Book value is where you may want to veer from the analysis on my site. There are times that you will find a company that is simply been beaten down too far. If you see that this downtrodden company is trading below its book value, you may want to consider an investment. Please be careful with this investment though since worse times often follow bad times. Not all companies that are trading under book value will ever recover from their illnesses.

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Company name Thermo Fisher Scientific Inc.
Stock ticker TMO
Live stock price [stckqut]TMO[/stckqut]
P/E compared to competitors Good

MANAGEMENT EXECUTION

Employee productivity Good
Sales growth Fair
EPS growth Good
P/E growth Poor
EBIT growth Good

ANALYSIS

Confident Investor Rating Good
Target stock price (TWCA growth scenario) $105.16
Target stock price (averages with growth) $125.48
Target stock price (averages with no growth) $101.97
Target stock price (manual assumptions) $102.67

The following company description is from Google Finance: http://www.google.com/finance?q=tmo

Thermo Fisher Scientific Inc. (Thermo Fisher) is engaged in serving science. It operates in three segments: Analytical Technologies, Specialty Diagnostics and Laboratory Products and Services. It serves its customers through three brands: Thermo Scientific, Fisher Scientific and Unity Lab Services. Thermo Scientific is its technology brand. Fisher Scientific is its channels brand. Its Unity Lab Services offers portfolio of enterprise services for instruments and laboratory equipment. Unity Lab Services offers a network of service and support personnel. In April 2012, it opened a new demonstration laboratory and training center in Seoul, South Korea. In May 2012, it acquired Doe & Ingalls Management, LLC. In September 2012, it acquired One Lambda, Inc. In September 2012, Thermo Fisher opened its Molecular Biology Center of Excellence in Vilnius, Lithuania. In October 2012, OpenGate Capital, LLC acquired the Laboratory (Lab) Workstations business from Thermo Fisher.

 

Confident Investor comments: At this price and at this time, I think that a Confident Investor can confidently invest in this stock.
If you would like to understand how to evaluate companies like I do on this site, please read my book, The Confident Investor.

For owners of my book, “The Confident Investor” I offer the following analysis (you must be logged in to this site as a book owner in order to see the following analysis). If you have registered and cannot see the balance of this article, make sure you are logged in and refresh your browser.
[s2If current_user_can(s2member_level1)]
In order to assist you in using the techniques of this book, the values that I used when calculating the Manual pricing above were:

Stock price at the time of the calculation: $91.56

Growth: 0.13

Current EPS (TTM): $3.59

P/E: 25

Future EPS Calc: $6.61

Future Stock Price Calc: $165.35

Target stock price: $102.67

I hope that this makes you a better investor. [/s2If]

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Company name POZEN Inc.
Stock ticker POZN
Live stock price [stckqut]POZN[/stckqut]
Confident Investor Rating Poor

The following company description is from Google Finance: http://www.google.com/finance?q=pozn
POZEN Inc. (POZEN), is a pharmaceutical company focused on transforming medicine. The Company had developed Treximet in collaboration with GlaxoSmithKline (GSK). Treximet is the brand name for the product combining sumatriptan 85 milligram, formulated with RT Technology and naproxen sodium 500 milligram in a single tablet designed for the acute treatment of migraine. The Company has developed VIMOVO with AstraZeneca AB (AstraZeneca). VIMOVO is the brand name for a fixed dose combination of the proton pump inhibitor (PPI) esomeprazole magnesium with the non-steroidal anti-inflammatory drug (NSAID) naproxen in a single tablet. On November 23, 2011, the Company entered into a Purchase and Sale Agreement with CPPIB Credit Investments Inc (CII,), pursuant to which it sold, and CII purchased, its right to receive future royalty payments arising from United States sales of MT 400, including Treximet.
Confident Investor comments: At this price and at this time, I do not think that a Confident Investor can confidently invest in this stock. It is not possible to confidently invest in a company that is not currently profitable.

If you would like to understand how to evaluate companies like I do on this site, please read my book, The Confident Investor.

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Company name Skilled Healthcare Group, Inc.
Stock ticker SKH
Live stock price [stckqut]SKH[/stckqut]
P/E compared to competitors Good

MANAGEMENT EXECUTION

Employee productivity Poor
Sales growth Poor
EPS growth Poor
P/E growth Poor
EBIT growth Poor

ANALYSIS

Confident Investor Rating Poor
Target stock price (TWCA growth scenario) $-226718.39
Target stock price (averages with growth) $0.5
Target stock price (averages with no growth) $0.5
Target stock price (manual assumptions) $3.09

The following company description is from Google Finance: http://www.google.com/finance?q=skh

Skilled Healthcare Group, Inc. (Skilled) is a holding company. The Company owns subsidiaries that operate skilled nursing facilities, assisted living facilities, hospices, home health providers and a rehabilitation therapy business. It operates in three segments: long-term care (LTC), which includes the operation of skilled nursing facilities and assisted living facilities; therapy services, which includes its integrated and third-party rehabilitation therapy services, and hospice and home health services, which includes its hospice and home health businesses. As of December 31, 2011, the Company owned or leased 74 skilled nursing facilities and 23 assisted living facilities, together comprising 10,495 licensed beds. On July 1, 2011, it acquired Altura Homecare & Rehab, which is a home health care agency serving the Albuquerque. On July 11, 2011, it acquired the real property and related operations of Willow Creek Memory Care.

 

 

Confident Investor comments: At this price and at this time, I do not think that a Confident Investor can confidently invest in this stock.
If you would like to understand how to evaluate companies like I do on this site, please read my book, The Confident Investor.

For owners of my book, “The Confident Investor” I offer the following analysis (you must be logged in to this site as a book owner in order to see the following analysis). If you have registered and cannot see the balance of this article, make sure you are logged in and refresh your browser.
[s2If current_user_can(s2member_level1)]
In order to assist you in using the techniques of this book, the values that I used when calculating the Manual pricing above were:

Stock price at the time of the calculation: $5.04

Growth: 0.01

Current EPS (TTM): $0.43

P/E: 11

Future EPS Calc: $0.45

Future Stock Price Calc: $4.97

Target stock price: $3.08

I hope that this makes you a better investor. [/s2If]