CCA Industries (NASDAQ–CAW)
Price August 4, 2008-$7.00
We recommended CCA back in 2006. Ultimately, we booked a 21% gain on it.
CCA has consistently made money over the years and pays a handsome dividend—6.3% yield.
Last time we recommended CCA it was at $9.45 a share and sold it at $11.50.
They had a take-over offer that never went through.
CCA has 60%+ gross margins and $2.56 a share in cash.
So far this year (6 months ended 5/31/2008) sales were down 3% and net income was down to $.16 from $.25 last year.
So while their sales and EPS performance has been lackluster, their balance sheet and dividend provides good support.
Trading at 38% of our valuation, with $2.56 per share in cash, we think that this one will be bought-out at some point in the double digit price range.
The 52 week low has been $6.61 and the high–$10.25.
HSTM trades about 5,000 shares a day, so be careful buying. We bought a little today at $7.00.
There are about 7.1 million fully diluted shares outstanding.
CCA Industries, Inc. manufactures and markets health and beauty aids, each under its individual brand name. The products include, principally, “Plus+White” toothpastes and teeth whiteners, “Mega-T” Green Tea diet supplements, “Mega-T” Green Tea gum and mint products, “Bikini Zone” medicated topicals and shave gels, “Nutra Nail” nail care treatments, “Scar Zone” scar treatment products, “Sudden Change” anti-aging skin care products, “Parfume de Vanille” fragrances, “Solar Sense” sun protection products, “Hair Off” hair removal and depilatory products, and “Wash ‘N Curl” shampoos and conditioners.