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http://gmcstockpicks.com  Proprietary algorithms at work.  Click here for our free newsletter: http://goo.gl/APYNVJ . This is a review of an undervalued stock in the Basic Materials Sector and Maching Tools a Accessorites Industry.   Low priced stocks to buy. We do not look at penny stocks. Stock options are a safer bet than penny stocks.  Like us on Facebook: https://www.facebook.com/gmconner14 Follow us on Twitter: https://twitter.com/gmcstockpicks Add us to your circles on Google Plus:  https://plus.google.com/u/0/+Gmcstockpicks/posts Subscribe to our podcast on iTunes:  https://itunes.apple.com/us/podcast/value-momentum-gmc-stock-picks/id737369520?mt=2 Listen and subscribe to our podcast on Stitcher Radio: http://www.stitcher.com/podcast/value-momentum-gmc-stock-picks?refid=stpr Transcript Below: 0:01 Everyone Mathis Conner here with Conner management group and this week we're going to look at 0:06 the base the best basic material stock to buy today is Thursday, January 30, 2014 and 0:16 as we can see from the opening slide the stock to talk about this in the machine tools and 0:23 accessories industry and we see this company's had a 12 month upside potential 30.4% on the 0:34 the name of his company's call in a Incorporated I myself I had heard company before it's no 0:44 not a very large company and the name of the company is literally and now noninfringement 0:52 is double and during this presentation ticker symbol is an NPR I was skinny industries in 0:59 the machine tools and accessories industry we see it upside potential and 30.4% some 1:07 quick facts going to Korea engages in the manufacture and sale of metal bearings plastic 1:16 and rubber precision metal components were very dairy manufacturers worldwide and operates 1:22 in three segments middle components plastic and rubber components and precision metal 1:29 components another description we adhere is an in manufactures and supplies high precision 1:38 bearing components of leading bearing automotive and industrial manufactures on a global basis 1:46 is divided into three operating segments mailbag components worried get 68% of its sales precision 1:56 metal components lyricist 21% of sales and the remainder the plastic and rubber components 2:03 were received 11% of its sales so the disaster at basic materials company and a provide a 2:11 lot of that just basic malware plastic and in unguarded coupons to lots of different 2:18 kinds machines the website for Dublin is an anti-PR.com best triple-double you got an 2:27 NPR.com the headquarters for an in is Johnson City Tennessee it were founded in 1980 and 2:36 number employees they have are 1781 industrial goods is the sector of the operating within 2:47 and the industry the operate within this machine tools and accessories of the supercenter is 2:55 basic materials of the general sectors industrial goods and the industry is machine tools accessories 3:02 the annual revenue last 12 months for an end was $363 million net income was 21 million 3:11 and cash from operation last 12 months was $40 million and the market capitalization 3:17 for an and is only $379 so the scummy's most smaller and what we looked at in the past 3:26 but they been around for a number of years and we can visit this is a good opportunity 3:34 to the products and services page we have some pictures of the kinds of the things that 3:40 they do placebos of pictures here are some windmills in the background of this says fees 3:48 are friendly providing components for wind power is some picture out so machine cylindrical 3:56 components of different geometries is decision metal components meeting the strictest specification 4:03 is a picture here of the plastic cover of my has some radiator type extends to it since 4:12 plastic and rubber parts any application shows a three states and rehab here there is a few 4:19 more pictures of the same military components precision out components and plastic and rubber 4:26 components as well taking a look at some of their metrics now as he mentioned annual revenues 4:35 last 12 months for an end was $363 million the net income was $21 million and the cash 4:42 from operations was $49 on to the operating margins for 2012 and is operating margins 4:51 were 11.8% and they expanded nicely I force over 2013 attracted to be 14% so that associate 5:03 a nice less than the city the trailing P/E ratio was 14.4 is 14.9 the forward P/E ratio 5:15 is 13.8 so that that's the right trend see and while .2 .900 13.8 is and is in a 5:27 huge drop implying a large increase an and earnings however that that trend combined 5:38 with an expectation improving margins can create a nice opportunity the other valuation 5:46 metrics the paid ratio of 1.1 not not outline the statistic prices sales ratios of 0.9 also 5:56 picture to suggest some important the price of books at 2.2 and that enterprise value 6:04 to either.is slowly it 8.2 so by Mark the value met the valuation metrics are not expensive 6:15 at all client by any means the recent closing price or today's closing price for and it 6:21 was $18.19 52-week low. It's been $8.32 and it 52-week high. Was $21.42 so the recent 6:34 closing prices doubling closer to the high than the low and we can see that the stock 6:41 has appreciated quite a bit over the past year and we still see quite a bit of outside 6:49 as well so the 20 day moving average was $19.09 the 50 day moving averages $19.40 and it 20 6:59 day moving average is $14.41 so overall that the pretty good trend that the 20 day moving 7:07 average is at next also nine cents is the logo below the 50 day moving averages $19.40 7:15 and minutes that's in line with the market going through its recent pullback of the past 7:20 month so overall as will see about price trend chart that the stock has been a year so the 7:29 average volume for an the average of the trailing by as and when I thousand shares so it is 7:36 not heavily traded stock but we solely considered near nearly liquid written: a very liquid 7:44 stock gold meeting here with the beta for the stock tip 3.7 so this the stock has historically 7:54 of zero point easily and readily when compared to the stock market in general and eight no 8:05 one really mindset when the stock is going to take a strong stomach but they do that 8:12 high wasů That's a short service of the state stock dividend yield for the stock is 0% of 8:21 the stock is only start pay dividends last to three quarters so we will just say the 8:27 average dividend is consumer and the average dividend payout ratio for 2013 has been 17% 8:37 taking a look at and ends price chart will see that back and late February the stock 8:46 started out the year of the little over eight dollars and is just steadily moved up we see 8:56 a high of around $21 OSC in late December and its pullback to read $18 and today were 9:11 red is so the stock is clearly it steadily moved up in price reflecting improving margins 9:22 and a number of steps that manages taken to improve the business's overall financial statement 9:30 quality and its fair you know the company historically has been has had quite a bit 9:39 debt but they been taking some steps to to improve that ants of the steps there reflects 9:46 their improving margins so be discontinued operations in some minds of low-margin businesses 9:54 and the they focus more the higher-margin businesses at and proceeded back and that's 10:00 what's been driving the increase the stock price over the past year so they debt they 10:07 also reduce the debt of the past year as well so the other financial statement quality is 10:14 fair but is this looks pretty promising that is going live improve of over the next year 10:20 the left let's see the annual sales rate for the past five years it's only averaged 1% 10:28 per year over the past five years of his expectation that sales are the next Celtics some some 10:36 more so sales of increasing that strip unit only increase since 2012 through today and 10:45 earnings are expected to increase as well so that sits of exclusive Karen and we believe 10:57 that it's it's it's the stories improving it to stop to take a closer look at as we 11:03 mentioned the operating market trend is improving price pattern trend it's on increase overall 11:11 market Outlook is still filled is bearish some names are starting to experience pullbacks 11:19 in the middle earnings seasons right now were with what we getting little mini corrections 11:26 across different names the market is as we speak the recent closing price trend in was 11:34 $18.19 today are 12 month price target dividend is 23 also $.72 so that is a 12 month appreciation 11:44 potential of 3.4% and in you know me not one of these household names unique you care about 11:54 the than the numbers that spoke the price action and to speak for itself people are 12:01 hearing about this is company owns a small company but we we feel it has a solid story 12:07 it's worth the exploring antics is a look at so that's what we have for this week and 12:16 and if you haven't already signed up for our newsletter please do some you can do that 12:22 by going to www.GMCstockpicks.com and you be among the first to hear that timely investment 12:29 opportunities such this one and this up spinous opportunities a reflection of using our self 12:36 developed proprietary algorithm that review over 3500 stocks every week we analyze and 12:44 rank stocks as far as appreciation potential so good to our website and sign up to share 12:53 share newsletter love the know about it and that's all we got this week to take your talkies 13:00 and