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ASGN -
BOUGHT
at $4.45 SOLD
at $9.92
On August 6th On
Assignment, a temporary staffing company for the science and healthcare
industries, reported 2nd quarter 2003 revenue of $54.2 million which
was down from the $67.6 million reported for the 2nd quarter of 2002.
Net loss for the quarter was $79.5 million compared with net income of
$3.8 million in the year earlier quarter. However, the entire loss
reflects a $79.9 million impairment charge for goodwill. Before this
goodwill charge operating income was $433,000. On Assignment has taken
cost cutting measures mainly in the form of headcount reductions in
order to align costs with lower revenues. The company was also able to
increase gross margins during the last quarter.
ASGN and it's
competitors have suffered from an industry wide slow down and their
stocks have declined dramatically over the last 12 months.
ASGN
has $31.6 million in cash and cash equivalents or $1.26 per
share. Book value is $2.47 per share. Though a price to
book
ratio of
1.8 is a little higher than our average recommendation it is
significantly lower than the average price to book ratio of Asgn's
competitors. The company carries no debt and the stock trades at .5x
sales.
Looking at the
chart above you can see that ASGN has broken the steep downtrend that
began in early 2002. ASGN has lost half it's value since the beginning
of the year and even more over the last 12 months. Over the last 5
years ASGN spent most of the time at significantly higher prices. Since
breaking it's downtrend line ASGN has pulled back and found support in
the low $4 range as the downtrend line which had been resistance is now
acting as support.
11/07/05
- SOLD
AT $9.92 FOR A GAIN OF 123%. DURING THE SAME PERIOD THE NASDAQ
WAS
UP 23%.
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