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Scanning the lists of best gainers I came across Mannatech Inc. (MTEX) that closed today at $9.98, up $1.08 or 12.13% on the day. I don't like low-priced stocks very much but this stock is ALMOST $10/share and its numbers, while not perfect, are certainly provocative! I do not own any shares or positions in this company.
According to the money.cnn.com "snapshot" on MTEX, Mannatech "...develops and sells proprietary nutritional supplements and topical products through a network marketing system, offering its products worldwide through a network consisting of 192,000 active associates." This sounds a little like a multi-level marketing plan like Amway...hmmm.
I found the third quarter 2003 earnings report on the Mannatech Website. Net sales for the quarter were $49.7 million, a 44.1% increase over the same quarter the prior year. Net income for the quarter was $2.9 million or $.11/diluted share compared to $.2 million or $.01/diluted share the prior year.
Looking at the "5-Yr Restated" Financials on Morningstar.com we see that revenue growth has been a bit erratic between 1998 and 2000 when it changed from $165 million to $150 million. Revenue bottomed at $129 million in 2001 and has been heading higher since. I would prefer to see five years of steady revenue growth instead of this "V" pattern, but they appear to be growing steadily for the last several years.
Earnings have improved since 2000 when they came in at $(.30)/share, turned profitable at $.07/share in 2002, and are reporting $.24/share in the last twelve months per Morningstar.
Free cash flow which was $(9) million in 2000, improved to $6 million in 2001, $9 million in 2002, and is at $16 million in the trailing twelve months.
The company appears to be quite solvent with $17.1 million in cash per the website, and $13.0 million in other current assets. Their current liabilities stand at $19.2 million with only $800,000 in long-term debt per Morningstar.com.
This is certainly a small cap stock with a market cap of $258.02 million. The trailing p/e is 41.07 but no forward p/e reported on Yahoo (perhaps due to lack of analysts?). Thus, no PEG is possible. They are selling at 1.32 times sales...so not unusually expensive on this basis.
Yahoo reports they have 25.85 million shares outstanding with 14.40 million of them that float. There are 1.05 million shares out short, representing 7.32% of the float or 4.835 trading days. This was as of 1/8/04; the prior month, the short interest stood at 477,000, so this has more than doubled over the 30 day period.
A small cash dividend of $.10/share is paid yielding 1.12% and no stock dividends have been noted on the Yahoo site.
If we look at the point and figure chart from Stockcharts.com, we can see that this stock was generally trading down between 1999 and 2000, traded flat between 2001-2002 where it appears to have had a "double bottom", and then broke through resistance in June, 2003 at about $4.25/share, and has headed higher since. It doesn't really look too bad a chart to me...but then that is certainly not my strength.
This is an interesting stock to consider. I certainly am not in the market for stocks having sold several at 8% losses...and am waiting for a sale on a gain...and then will consider adding a position. The stock is a little small for me and the price about $10, leaves little room for any correction if you are sticking with the 8% loss rule. Not exactly a high-quality stock...but then again, if you would like a small cap stock with nice growth characteristics, nice balance sheet, growing free cash flow...and you think this multi-level marketing plan selling vitamins is the way to go...well then this just might be your cup of tea...or should I say your multivitamin of the day?
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