Bill Matthews: Emerson Radio (MSN)

By Steven Halpern, TheStockAdvisors.com | Jan 13, 2010 | comment

"Emerson Radio (NYSE: MSN) is an atttractive, low-priced stock," says Bill Matthews. In The Cheap Investor he suggests, "I see the potential for significant appreciation in 2010."

"In this market, we wanted to recommend a quality low priced stock that is relatively safe, has good increasing revenues and outstanding earnings.

"We are also looking for a stock that is selling at an attractive low price, and has the potential for significant growth and stock appreciation in 2010. Emerson Radio fits these criteria.

"Emerson Radio is a household name. Together with its subsidiaries, it engages in designing, marketing, selling, and licensing various consumer appliance, electronic and house ware products.

"It products are sold in the United States and internationally. Emerson Radio Corp. markets its products under the Emerson and HH Scott brands.

"The company distributes its products primarily through mass merchandisers, discount retailers, toy retailers, and distributors and specialty catalogers in the United States.

"Emerson has an excellent balance sheet with $29 million or $1.06 per share in cash, a book value of $2.25 per share and less than $6 million in debt. Insiders own 65% of the 27 million total shares outstanding and 22 institutions own 17% of the float. 

"Emerson has excellent financials for the six-month period ended September 30. Revenues are $107 million up from $97 million a year ago. Net income is $4.3 million or $0.16 a share up from a loss of ($242,000) or (.01) a share verses a year ago.

"If you look at Emerson’s stock chart between June 2002 and June 2003, you’ll see that the price soared from $1.50 to $7.50 because of excellent revenue and earnings increases.  We believe, that if Emerson continues its earnings growth, the price could skyrocket again."

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