Saturday, March 15, 2014

Global Sources: Special Situation + Value

Yesterday, business-to-business media company Global Sources (GSOL) announced that it would buy back $50 million worth of shares of the company at $10 per share. Nevertheless, shares of GSOL trade for just $8 despite the fact that the company trades for a P/E under 10 and operates with what appears to be a competitive advantage.Read more...


Phil K said...

Hi Saj,

I'm a little confused about GSOL these days....the company is currently on sale for 191mm and has 143mm in cash and investments with an average net income of 30mm per year for the last 4 years.

It has the feeling of being too good to be true. Is there anything you saw on this one that I might be missing?


Saj Karsan said...

Hi Phil,

A couple things I don't like. One is their cash machine (print advertising) is on the decline. While they're transitioning to in-person conferences, it remains to be seen if they can do this while maintaining profits. The second thing is they are probably not getting good use out of their assets. I don't really know what their Asian RE strategy is but I do know that the messing around does not make me comfortable.