Welcome to the second lightening round of the 5-Stock Bonanza! Today we will take a concise, but yet comprehensive look into the top five positions in Tobias Carlisle’s All Investable Screener.
First, Apollo Education Group, Inc. (APOL) is the top contender with an Acquirer’s Multiple rating of -0.07. At first glance, this is a position that value investors love indulging in because its enterprise value is -0.05. When the enterprise value is negative, it simply means that the company currently has more cash and cash equivalents on hand than the sum of the company’s market capitalization, preferred equity, non-controlling interests, and total debt. In short, this company is a steal! Furthermore, APOL is a privatized education provider for both domestic and international students. Educational services include, but are not limited to, undergraduate and graduate programs, certification courses, and educational workshops for avid learners. APOL operates through many separate segments, including The University of Phoenix, Carnegie Learning, Western International University, and several other reputable entities. One of Apollo Education’s main objectives is to tailor its services to the needs of the educational community. For example, candidates can achieve degrees by means of the delivery of preference; online or on-campus. Moreover, APOL is currently well undervalued when compared to its peer group.
| Metric | APOL | Industry Average |
| P/E | 14.8 | 26 |
| P/B | 0.7 | 2.0 |
| P/S | 0.3 | 1.3 |
Apollo Education’s global Impact illustrated below:
Second, MoneyGram International, Inc. (MGI) is a domestic and international money transfer and payment services provider. MGI has two branches, Financial Paper Products and Global Funds Transfer services. The Financial Paper Products leg offers check services to financial institutions, as well as, provides money order services to consumers. Its Global Funds Transfer leg offers money transfer and bill payment services to unbanked and under banked clients. MoneyGram’s most popular products and services include money orders, prepaid debit cards, online bill pay, and wire transfers. First and foremost, MGI is a $527 million capitalization corporation with an Acquirer’s Multiple rating of 0.25, which is incredibly undervalued. MGI also has an enterprise multiple of 0.14, which means current investors are basically receiving this company for free! Although MGI has had inconsistent earnings, we do see a progressive uptrend in their net income throughout the past five years.
| MoneyGram International, Inc. | |||||
| Year | 12/2010 | 12/2011 | 12/2012 | 12/2013 | 12/2014 |
| Net Income | $44,000,000 | $59,000,000 | ($49,000,000) | $52,000,000 | $72,000,000 |
Furthermore, MGI has a P/S of 0.4, which is fantastic in relation to the industry average of 3.6. We do see some weaknesses in the past profitability of MGI, as their profit margin from the most recent reporting period is -4.90%. Also, return on assets for the most recent reporting period measured 0.59%. Although MGI has had instability problems with earnings, this company is extremely cheap and would be a wonderful asset for quantitative value investors.
Third, Perion Network Ltd. (PERI) is an Israeli media and internet company that provides search-based monetization solutions. Primary clients include mobile application developers and online publishers, in which Perion provides data-driven solutions to promote and monetize their client’s content and services. Now, I must say I am very excited about this company’s current positioning and achievements in relation to competitors. Without further ado, we will let the numbers speak for themselves:
| PERI | Industry Average | |
| P/E | 5.1 | 89.2 |
| P/B | 0.6 | 5.4 |
| P/S | 0.6 | 5.0 |
| Revenue Growth (3 Yr Avg.) | 122.1% | 10.9% |
| Net Income Growth (3 Yr Avg) | 96.2% | (10.6%) |
| Operating Margin | 15.2% | 10.7% |
| Net Margin | 11.4% | 5.6% |
| ROA | 9.3% | 3.1% |
| ROE | 12.2% | 6.0% |
| D/E | 0.1 | 0.4 |
In conclusion, PERI has an Acquirer’s Multiple rating of 1.09 and an enterprise multiple of 0.87, which is extremely attractive. Therefore, Perion Network is a wonderful company that is currently well positioned to deliver extensive shareholder value for those seeking to add another position to their portfolio.
Fourth, CTC Media, Inc. (CTCM) is a $170 million capitalization independent media company, who is based in Moscow, Russia. CTCM operates three free-to-air television channels, which offer: entertainment for families, women’s lifestyle, and action films and shows. The company’s primary mission is to create stories that inspire viewers and promote positive, uplifting emotions. CTC Media’s primary audience is located in Russia and Kazakhstan. In 1996, CTCM became the first Russian broadcaster to adopt the U.S. network structure. CTC currently has an Acquirer’s Multiple rating of 1.63 and an enterprise multiple of 1.38. CTCM is well positioned in its industry, as expressed below:
| CTCM | Industry Average | |
| P/E | 4.2 | 25.3 |
| P/B | 0.7 | 1.6 |
| P/S | 0.5 | 1.9 |
| Net Margin | 12.4% | 6.2% |
| ROA | 8.3% | 2.3% |
| ROE | 11.4% | 5.6% |
CTCM clearly appears to be very cheap and valuable in relation to the industry average. In conclusion to the data, CTC Media has extensive value to provide for potential investors.
Lastly, Brasilagro Companhia Brasileira de Propriedades Agricolas (LND) is a $168 million capitalization company that engages in cattle raising, agriculture, and forestry activities in Brazil. LND’s three primary operating segments are grains, sugarcane, and real estate. The company also produces soybeans, corn, rice, cotton, and sorghum. Furthermore, LND currently owns 10 farms spread across five Brazilian states, in which the company owns 769,936 acres and has leased 43,735 acres. Moreover, LND has an Acquirer’s Multiple rating of 1.76, with an enterprise multiple of 1.54. Lets take a brief look at LND’s current positioning in relation to its peers:
| LND | Industry Average | |
| P/E | 52.8 | 15.4 |
| P/B | 1.0 | 1.6 |
| P/S | 3.5 | 0.4 |
| Revenue Growth (3Yr Avg.) | 14.5% | 0.1% |
| Net Margin | 6.6% | 2.6% |
| D/E | 0.1 | 0.4 |
As illustrated in the data, LND provides much strength, in which we believe a prudent investor should be aware of. In conclusion, we view LND as a buy prospect for investors looking to expand their current quantitative value portfolio.
My name is Brodie Hinkle and I am currently a senior at the University of Oklahoma. I am a double major of finance and energy management. I will be periodically writing opinionated articles about individual companies that show up on Tobias Carlisle’s stock screeners. All of my numerical data can be traced back to both Yahoo Finance and Morningstar.
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