Monday, March 13, 2006

SFCC Update

For SFCC stock holders, the couple weeks around their last earning release was not a easy journey. SFCC did not release numbers on their scheduled release date, saying there was some impairment charges in Q4, and earnings were postponed for a week. The stock dropped into 18's on the news.

However, what a relief it is to read their earnings the following week, it showed the business is in very good shape in general. Somebody is asking me about my opinion after this earning release, I can tell you frankly that I still strongly believes this is a good long term holding with a target of 30$+.

I like the stock for a few reasons:
* The private clinical testing service is a good sector to be in to capitalize the ever lasting healthcare needs.
* The stock was beaten down not by deteriorating business operations, but largely screwed by journalists and politicians. Although this puts on negative effects on the business in short term, the business itself is still in good shape.
* Given above and its year 2006 revenue/earning numbers, I think the stock is still cheap.

Full disclosure: I long SFCC.

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