Web Site
Google Finance
SEC Filing
Jan, 22, 2013
2012 Data
Year end: Aug 31
Check list:
1.Major Business.
The company was fund at 1950 and make precision contract machining for aerospace. In 1960s, the company started to produce Fluid Power device for agriculture industry. In 1989, it stopped Fluid Power division. In 1990s, it closed two plants and started to refocus on precision machining.
1991 to 1993 sale down from $45m to $30m. Lost quite a lot money. The CEO quit at 1993.
1994 to 1995 revenue stable at $30m and start be profitable.
1996-2000 again revenue decline sharply to $20m and steady. Then temporarily raise to $32m at 2000.
2001-2008 revenue drop to $10m low at 2002 then steady back to $26m at 2008.
2009-2012 revenue drop to $19m then go back to $32m at 2012.
At Jan. 2012, CEO retired, hired new CEO.
2/3 of sales is to RV(Recreational Vehicle) industry. 1/4 sales to energy industry.
Major customer:
Polaris Industries: 60% of sales. RV maker.
FMC Technologies: 16% of sales. Energy sector
National Oilwell Varco: 15% of sales. Energy sector
2.Balance sheet.
Recent Price: $6.33, Tangible book value:$3.30, Share outstanding:2.9m, Market Cap: $18.4m.
Current asset:$10.6, Current liability:$4.58, Debt:$6.99, Inventory:$3.57, Cash:$2.47.
Current ratio >= 2.
3.Credit facility.
Principles, interest rate, covenant, outstanding, payment schedule,
4.Financial data by years.
Revenue, Earning, FCF, FCF-WC, Dividend.
Optional: CF-WC, CAPX, SG&A, R&D.
Revenue/Price ratio.
Dividend policy
| 2012 | 2011 | 2010 | 2009 | 2008 | 2007 | 2006 | 2005 | 2004 | 2003 | |
|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | 32.5 | 25 | 18.8 | 18.8 | ||||||
| OP Income | 2.3 | 1.41 | 1.0 | (0.25) | ||||||
| Income | 1.47 | 0.9 | 0.64 | (0.16) | ||||||
| CF-WC | ||||||||||
| CAPX | ||||||||||
| Cash | ||||||||||
| Debt |
5.Cost structure
Leasing obligations. Flexible cost structure or fixed cost structure? Cost controls.
6.Insider holding, options, Insider trading info, share buy back.
Insider holding over 15% is preferred.
7.Management compensation.
A reasonable management compensation. Compare dividend with compensation.
8.Employee numbers. Revenue/Employee. Compensation/Employee.
Whether employees are unionized, etc.
9.Industry comparison.
Precision industry seems very fragmented with a lots of small companies. The reason might be that its basically an addon service to its customer. If the customer's products requires too much precision work, it might just buy its own machine and do it themselves.
This is the local organizational that WSCI in: http://www.mpma.com/index.html
This is the national organization: http://www.pmpa.org/home, however, WSCI is not one of them
PMPA Business Trends Index: This is pretty useful to get the market condition of the whole industry. However, now way to find historic data.
It seems the MIC(made-in-china) doesn't affect this industry too much. Might because it more like a service than just manufacturing.
10.Auditor
Better be among the big four.
11.Major events.
Business acquisition, law suit etc.
12.Comments.
(1)Some of its revenue includes a pretty big part of cost which is pass through to customer. So the revenue reported is less useful.
(2) The current CEO is young(about 40). He is pretty success in his previous business and it was acquired by others. He acquired quite a lot shares of WSCI after he became CEO.
(3) The company's communication with share holder is pretty poor and hard to get useful information likes the real revenue picture, etc.
(4) Its debt includes several million in capital leasing which make it hard to understand the real CAPX and cash flow numbers.
(5) In current several years, including the recession, the company did pretty well, especially from cash flow point. However, Its revenue up and down a lot which is pretty common in precision manufacturing industry I guess. It really hard to tell how the company will preform in the future. Which make it attempting only on current basis. It seems the whole precision industry and the company itself are not stable. The business is hard to understand from this aspect.
