Wednesday, May 18, 2016

Automodular Corp.

Sound bite for Twitter and StockTwits is: You should never put into such things money you cannot afford to lose. That is why my investment is so small, but it is a fun investment. I hope that the management of this company will be able to pick up something that they want to do. See my spreadsheet on Automodular Corp.

I own this stock of Automodular Corp. (TSX-AM.H, OTC-AMZKF). In January 2012, I went looking for some dividend paying small cap to soak up extra money in the TFSA. This is one of the stocks that I found to soak up extra cash in the TFSA.

In December of 2014, Automodular Corporation shipped its final modules to Ford's Oakville Assembly Plant. Since then the company has no business and is looking for some.

The company last had revenue in 2014. They have cash on hand that currently equals 102% of the market cap. They have discontinued their dividend. They were always rather hit and miss about dividends in the past so this is not so surprising. They have been buying back shares on the open market.

Since I bought this stock in 2012 I have made a 17.1% per year return with 6.14% per year from capital gains and 10.96% per year from dividends. I only invested around $1,000 in three separate investment in this company and I am holding on to the shares to see how this all ends.

Since the cash on hand equals the current stock price, I can see no advantage in buying this stock. This is around $2.49 a share. However, when the company was buying back shares recently they were paying $2.53 and $2.65 per share.

It would be great if they find something else to do. According to the history on their website they have been involved in a number of different business over time. One problem is that this is not the best of economic times. It has been a very long slow recovery from the last recession and it looks like we will not completely recover from that recession before we get to the next.

Alec Mazo talked about this stock in August 2015 on Seeking Alpha. Nothing much has changed. The most recent news is in April 2016 when Automodular Corp announced a Dutch auction to buy back shares.

I will have only one entry for this stock this year. However, I did a more complete report on this company in 2015 and you can see that report here.

Yesterday on my other blog I wrote about Me and CDZ... learn more . The next stock I will write about will be Husky Energy Inc. (TSX-HSE, OTC- HUSKF)... learn more on Friday, May 20, 2016 around 5 pm.

Automodular Corporation currently has no business. Its web site is here Automodular Corp.

This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.

See my website for stocks followed and investment notes. I have three blogs. The first talks only about specific stocks and is called Investment Talk . The second one contains information on mostly investing and is called Investing Economics Mostly. My last blog is for my book reviews and it is called Non-Fiction Mostly. Follow me on Twitter or StockTwits.

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