Grahamian Value Week in Review

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Grahamian Value Week in Review ― September 25, 2020
grahamianvalue.substack.com

Grahamian Value Week in Review ― September 25, 2020

Sep 25, 2020
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Grahamian Value Week in Review ― September 25, 2020
grahamianvalue.substack.com

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“For a value investor, price has to be the starting point. It has been demonstrated time and time again that no asset is so good that it can’t become a bad investment if bought at too high a price. And there are few assets so bad that they can’t be a good investment when bought cheap enough.”

― Howard Marks, The Most Important Thing: Uncommon Sense for the Thoughtful Investor (pg 24)


PART ONE.

WEEK IN REVIEW

PART TWO.

COMMUNITY INSIGHTS


In the past week —

  • We added an in-house data room containing detailed analytics, curated insights, and select primary source data for Dawson Geophysical Co. — available upon request per last week’s GV Week in Review.

  • We have continued adding detailed historical data and select insights to Grahamian Value listed company profiles.


I. WEEK IN REVIEW

Developments at three Grahamian Value listed companies have piqued our interest.

Dawson Geophysical Co.

As those who requested access to our data room know, the COO of Dawson Geophysical recently sold 16,603 shares of stock — leaving him with beneficial ownership of 105,002 shares.

Twitter avatar for @EnterpriseLeadeEnterprise Leader @EnterpriseLeade
Dawson Geophysical Co $DWSN COO Sells $29,055.25 in Stock
Dawson Geophysical Co (NASDAQ:DWSN) COO Sells $29,055.25 in StockDawson Geophysical Co (NASDAQ:DWSN) COO C Ray Tobias sold 16,603 shares of the stock in a transaction dated Thursday, September 17th. The stock was sold at an average price of $1.75, for a total transaction of $29,055.25. Following the transaction, the chief operating officer now owns 121,089 shares…theenterpriseleader.com

September 20th 2020


Servotronics, Inc.

The only new addition to the GV | United States company list this week was Servotronics, Inc.

Twitter avatar for @theharrysauersHarry Sauers @theharrysauers
Any thoughts/insights on Servotronics $SVT would be very appreciated. Seems like an interesting situation at 0.8x NCAV, $4M in a PPP loan, pension obligations, 4x EV/EBIT, neg. FCF. Lots to untangle here.

September 20th 2020

2 Retweets9 Likes
Twitter avatar for @cashwithstringsJake @cashwithstrings
@theharrysauers I like it. If earnings continue we have a very realistic return around 16%. My only question mark is the inventories. I usually give inventories a 50% haircut. So I'm getting a conservative liquidation value around 7.8 mil and a mkt cap of 18 mil. But we have good earnings!

September 20th 2020

1 Like

Westell Technologies, Inc.

Westell Technologies’ Annual Meeting of Stockholders will take place on Tuesday with stated purposes that include:

  • To consider and act upon a proposal to amend the Company’s Amended and Restated Certificate of Incorporation (the “Charter”) to effect a reverse stock split of our Class A Common Stock and Class B Common Stock whereby, each outstanding one thousand (1,000) shares of the Company's Class A Common Stock and Class B Common Stock, respectively, would be combined into and become one (1) share of the Company's Class A Common Stock or Class B Common Stock, as applicable (the “Reverse Stock Split”).

  • To consider and vote upon a proposal to amend the Charter to effect, immediately after the Reverse Stock Split, a forward stock split of our Class A Common Stock and Class B Common Stock whereby, each one (1) share of the Company's Class A Common Stock and Class B Common Stock would divide into and become one thousand (1,000) shares of the Company's Class A Common Stock or Class B Common Stock, as applicable (the “Forward Stock Split,” and together with the Reverse Stock Split, the “Transaction”).

And —

  • Upon its effectiveness, the Transaction would result in (i) holdings prior to such split of fewer than one thousand (1,000) shares of Class A Common Stock or Class B Common Stock being converted into a fractional share, which will then be immediately cancelled and converted into a right to receive the cash consideration described in the attached proxy statement, and holdings greater than one thousand shares prior to such split will remain the same after the Transaction, and (ii) the Company having fewer than 300 stockholders of record of the Class A Common Stock, allowing the Company to deregister its Class A Common Stock under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and avoid the costs and time commitment associated with being a public reporting company.

Should Westell Technologies proceed with the “Transaction” (and barring any modification of terms), holders on record of fractional shares will receive $1.48 in cash in lieu of shares — as noted on July 13.

Twitter avatar for @Westell_TechWestell Technologies @Westell_Tech
Board of Directors of Westell Technologies, Inc. Approves Plan to Terminate Registration of Class A Common Stock
Board of Directors of Westell Technologies, Inc. Approves Plan to Terminate Registration of Class A Common StockAURORA, Ill., July 10, 2020 (GLOBE NEWSWIRE) -- Westell Technologies, Inc. (NASDAQ:WSTL) today announced that a Special Committee of independent directors has recommended, and its Board of Directors has approved, a plan for a proposed transaction whereby the Company would effect a reverse/forward …bit.ly

July 10th 2020


II. COMMUNITY INSIGHTS

Courtesy of Grahamian Value reader Daniel Toloko [linkedin | twitter]:

  • For peers searching for deep value opportunities beyond the United States (and/or, exceptional thought leaders) —

Twitter avatar for @daniel_tolokoDaniel Toloko @daniel_toloko
What are some of the best #fintwit accounts to follow? Some interesting twitter accounts: @HurriCap shares great annual reports @Fr_BGraham shares great research @Trinhnomics great insights into Asia's economies @japan_value goldmine for deep value #investors @Maple_captial same

August 4th 2020

1 Retweet14 Likes
Twitter avatar for @daniel_tolokoDaniel Toloko @daniel_toloko
Few more great accounts: @LuchesiPhilippe Shares great french stocks @ClarkSquareCap great insights & shareholder letters @ValueStockGeek sharing great insights @UPFINAcom Great macro updates @DevenirRentier More great french stocks :) @CapitalTalk2 great insights :)

August 4th 2020

10 Likes
Twitter avatar for @daniel_tolokoDaniel Toloko @daniel_toloko
Couple more :) : @saxena_puru shares his knowledge about growth stocks @Frank_Investing quotes on #valueinvesting @SlingshotCap Great insights @hkeskiva great insights (use translate) @permanentcap great insights @PythiaR great insights @aceglobalvalue for treasure hunters

August 4th 2020

5 Likes

Benjamin Graham, “Special Situations” — The Analysts Journal, Fourth Quarter, 1946, Vol. 2, No. 4 (Fourth Quarter, 1946), pp. 35

Compliments of Grahamian Value reader Daniel Sims [linkedin | twitter]:

  • An interesting “Class C” special situation —

Twitter avatar for @hiddenvalueblogDaniel Sims @hiddenvalueblog
Good announcement today that puts the liquidation value at $3-4 per share
google.com.au/amp/s/finance.…

Daniel Sims @hiddenvalueblog

https://t.co/uqyYzOSwxp Not a high conviction idea, but nevertheless some analysis on the situation over at Luby's $LUB

September 8th 2020

10 Likes

(Full Disclosure: the co-editors are personal shareholders in Dawson Geophysical Co., Westell Technologies, Inc., and Luby’s, Inc.)


ABOUT GRAHAMIAN VALUE

Grahamian Value is a labor of love, centered around our desire to openly share data and perspectives that we find helpful in our pursuit of Benjamin Graham-inspired investment ideas. We appreciate your time, your trust and your readership. Learn more at GrahamianValue.com

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Harry Sauers and Shai Dardashti are co-editors of Grahamian Value and, as of the date of this communication, may individually own shares of companies mentioned herein. This communication is for informational purposes only. This is not intended to be investment advice. Seek a duly licensed professional for investment advice.

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