I have written often about Armanino Foods of Distinction (symbol AMNF on the pink sheets). Armanino is and has been one of my favorite companies. This microcap makes and sells Italian foods and sauces. It has been growing nicely for years, both domestically and internationally. I pays a good regular dividend of about 4.8% and it has also paid special dividends in most recent years. The company will likely announce its results next Thursday or Friday. Based upon the last press release from management, it is actually reasonable to expect both record sales and profits for the quarter. The market is certainly making it clear that those are the sorts of results that are expected.
This week, Armanino reached a major milestone. For the first time in years, the stock broke through $1.00 per share and, as I write this, both the bid and asked are more than a dollar. When I first came across Armanino, it had about three and a half million shares outstanding and sold for just under $3.00 per share. Since then, the stock has been split more than once, so that each old share is now ten new ones. Even so, the last price was $1.03. That means that over the last decade or so, the stock price has more than tripled while paying high and increasing dividends the entire time. Indeed, based upon the original purchase price paid for much of the stock I own, the dividend return is about 18%, and that does not count the many special dividends that have been declared over the years.
Passing through the one dollar mark ought to give a boost to Armanino stock. There are certain funds which are forbidden by charter from investing in stock that is less than one dollar. It is true that many more funds have cut offs at $5.00 per share, but there are still enough that this latest price rise ought to help stoke demand for the stock for a while.
If the fourth quarter results just hit 2.0 cents per share, the company will have earned nine cents per share for 2012, a figure that indicates a P/E of 11.5. Since the company has been growing at a decent rate and has been racking up record sales and earnings quarter after quarter, that multiple for TTM is quite low. Indeed, if Armanino is able to grow earnings in 2013 by just 15% rather than the 27% rate that such fourth quarter results would mean of 2012, the EPS for 2013 would hit $1.035; this would put the P/E multiple at ten.
Armanino is a true gem in the market.
DISCLOSURE: I am long Armanino stock.
This week, Armanino reached a major milestone. For the first time in years, the stock broke through $1.00 per share and, as I write this, both the bid and asked are more than a dollar. When I first came across Armanino, it had about three and a half million shares outstanding and sold for just under $3.00 per share. Since then, the stock has been split more than once, so that each old share is now ten new ones. Even so, the last price was $1.03. That means that over the last decade or so, the stock price has more than tripled while paying high and increasing dividends the entire time. Indeed, based upon the original purchase price paid for much of the stock I own, the dividend return is about 18%, and that does not count the many special dividends that have been declared over the years.
Passing through the one dollar mark ought to give a boost to Armanino stock. There are certain funds which are forbidden by charter from investing in stock that is less than one dollar. It is true that many more funds have cut offs at $5.00 per share, but there are still enough that this latest price rise ought to help stoke demand for the stock for a while.
If the fourth quarter results just hit 2.0 cents per share, the company will have earned nine cents per share for 2012, a figure that indicates a P/E of 11.5. Since the company has been growing at a decent rate and has been racking up record sales and earnings quarter after quarter, that multiple for TTM is quite low. Indeed, if Armanino is able to grow earnings in 2013 by just 15% rather than the 27% rate that such fourth quarter results would mean of 2012, the EPS for 2013 would hit $1.035; this would put the P/E multiple at ten.
Armanino is a true gem in the market.
DISCLOSURE: I am long Armanino stock.
No comments:
Post a Comment