Analysis appreciated.
Thanks
Gary
The yield is high at 7.9% but the stock has declined 25% year-to-date and is well off its highs trading near $11. Commodity price risks are at the top of our mind here where previous results had been pressured by the weak pricing environment. Its payout ratio from cash from operations is 47% over the last-twelve-months is solid and the balance sheet looks good as well with net cash of $16.4M. The stock is very cheap at 3.4x forward earnings, but we are concerned about capital preservation here given the momentum. ALV had a new well come online in September which helped results for the quarter. Our prior opinion largely stands as it is a very cheap energy name that is risky due to size and commodity price risks. We still want to see momentum improve here.