View Full Version : Stock Of The Day - TECUA Tecumseh Engines

James Boston
06-27-2005, 01:41 AM
I'm confused about this one. Book value per share is double what the shares cost. They're obviously not doing well right now, but I don't know why. Anyone remember some news I missed? These guys make lawnmower engines for alot of companies, as well as some other products.

06-27-2005, 10:44 AM
About 25% of their book value is goodwill, an intangible and worthless asset IMO. Property, plant and equipment (PPE) is valued at about the current share price. A very quick glance at the earnings statments looks like their costs are rising. A quick glance of the cash flow statement shows that depreciation and cap-ex spending is inline and their burning some cash. They've maintained their divy looks like. According to Yahoo only two analysts covering this stock.

06-27-2005, 05:29 PM
I don't know why you would recommended this as a stock of the day. It's a dog with fleas. Are you using a screener and only looking at a few ratios? Aside some problems already mentioned, its debt is 340mm with very negative cashflow (-58mm).
Aside from that, the press release for last quarter's 10-Q says: "In general, lower operating results were attributable to lower sales, higher commodity and other input costs in excess of price increases, and unfavorable foreign currency exchange rate changes."
If you are monitoring this stock, I would wait till some of these macro issues are resolved (they are improving now) and then maybe check with their IR and see how sales are for this quarter before putting any money down.

Good hunting

James Boston
06-27-2005, 09:16 PM
Are you using a screener and only looking at a few ratios?

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"Stock Of The Day" is by no means the best I could come up with. It's just the first thing I come up with, qualitatively speaking, and then I look at the numbers. It could become a quick, resounding "no." Tecumseh does make ALOT of major lawn mower manufacturers engines. I figured supplying so many companies was a good sign, I was wrong.