Buy Rimage @ $14.20

Rimage Corporation (NASDAQ-RIMG)
Valuation-$26.45
Price May 24, 2011-$14.20

RIMG is trading about $.20 above its 53 week low. It has $12.33 a share in net cash, is making money and pays a $.10 quarterly dividend for a 2.8% yield. Guidance for the year is revenues of $80-85 million and earnings of $.55-$.65 per share.

Not in an exciting business, but a new joint venture in China seems to be fueling some sales growth opportunities and a virtual publishing initiative sound interesting.

Not much downside here with the huge cash cushion. Any signs of sales growth should propel the stock to $20. Cash is 87% of the market cap.

Average trading volume is about 24,000 million shares a day, so patience is required.

About Rimage Corporation
Rimage Corporation (www.rimage.com) is the world’s leading provider of workflow-integrated digital publishing solutions that produce CD/DVD/Blu-ray Discs™ with customized content and durable color or monochrome disc labeling. Key vertical markets and applications for our systems include video workflows, retail, medical imaging and law enforcement. In addition, we have launched a multi-year process aimed at transforming Rimage into a higher-performing business. Our comprehensive strategy involves strengthening Rimage’s core disc publishing business; generating new revenue streams by leveraging our core capabilities and transitioning from a hardware supplier into a provider of total solutions; and identifying and investing in future opportunities in adjacent markets with strong growth potential. Headquartered in Minneapolis, Minnesota, Rimage is a global business with operations in North America, Europe and Asia.

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