ALJ Regional Holdings, Inc. (OTCMKTS:ALJJ) Climbs To New 52-Week High
After remaining flat for two sessions in a row yesterday the stock of ALJ Regional Holdings, Inc. (OTCMKTS:ALJJ) jumped up the chart. It posted a gain of over 7% and reached a close at $3.70 per share. During the session the company registered its new 52-week high of $3.75 per share. The impressive performance took place on the biggest daily volume seen by ALJJ since mid-August of 70 thousand shares.
At the start of last year ALJ Regional Holdings sold its subsidiary Kentucky Electric Steel, the owner a steel mini-mill, and this left the company with virtually no operations. Instead of rushing to find a new business they decided to wait for the right opportunity to present itself – in October, 2013, they acquired Faneuil, a provider of outsourcing and co-sourced services. The transaction immediately caught the attention of the market and ALJJ’s stock surged from below 85 cents to $1.50 in just two weeks.
This May another acquisition was completed successfully but this time the target was Floors-N-More, LLC, d/b/a, Carpets N’ More, a floor covering retailer. The stock reacted in the exact same manner and surged to even higher price ranges.
The two deals have put ALJJ in an enviable position especially when compared to the rest of the pennystocks. The latest quarterly report covers the period ending June 30 and it shows the following financial results:
• $13.7 million cash
• $47.3 million total current assets
• $24 million total current liabilities
• $43.3 million net revenue
• $3.8 million net income
That is right ALJJ is not only a profitable entity but they have generated nearly $4 million in net income. A possible concern could be the fact that a sizable portion of their current assets, $23 million to be precise, consist of accounts receivable.
The last PR form the company came at the start of October and it revealed that ALJJ were able to substitute most of their existing debt with more favorable credit facilities provided by M&T Bank.
It seems that the two acquisitions are starting to pay off and the company is moving in the right direction. Still, the current record market prices could tempt some investors to cash in their holdings. Do your own due diligence and adjust your investment accordingly.
