I'm doing some basic modeling and financial analysis practice.
Can anyone recommend a public company that meets the following parameters:
-Around or below $500M market cap
-Very simple 1-2 product business
-Minimal historical M&A
Doesn't necessarily have to be an amazing business, just looking for a very clean, simple business to work on and practice some stuff.
Appreciate it. Thanks.
Organovo (ONVO), that stock is bitch... should've sold it when it was around $12
StarTek (SRT) is a pretty simple business (call center and business process outsourcing), small market cap ($140M) and has little coverage so should be interesting. There's an independent guy who writes reports on this company quarterly and they're pretty good in lieu of sell side research: http://www.omarsamalotanalysis.com/reports.html
JGW is another one I'd mention, very simple business of buying up structured settlements and other payment streams and then securitizing a bunch of them. On a cash flow basis essentially negative working capital (settlements are bought with warehouse funding line, and company is able to borrow more than purchase cost) Modelling is all about volume of purchases, spread between securitization rate and purchase rate, and fixed costs like advertising/etc. Interesting tax advantages too based on the GAAP vs tax accounting for these transactions. There's a Kerrisdale Capital report on JGW from earlier this year which has proved to be very optimistic, but is nonetheless a good intro.
Have you seen the JGW financials? Modeling those is anything but basic.. agree on SRT though.
For building a complicated 3 statement model like you would in banking, yeah, but modeling out cash flows based on a few core assumptions is not that difficult. The quarterly releases break down the adjustments separating out the effect of consolidating past securitizations and to model cash flow you need to make a few more adjustments. Accurately modeling out cash taxes is a bit difficult but Kerrisdale report is helpful to look at. Maybe not what OP is looking for but figured it's a pretty simple financial business and might be good to model something a bit different.
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Ticker HERB. The financials are all made up so its pretty easy.
I am pretty new to the forum. But I really enjoy the energy sector. One company that I would love to see how you analyze is ticker $CRK
Market Cap: $360M They have operations in the Eagle Ford, TMS , Haynsville & San Juan Basin.
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