BUY AGYS @ $8.40

Agilysys Inc. (NASDAQ–AGYS)

Valuation-$16.10
Price January 18, 2013-$8.40
AGYS is just the kind of stock we like. Software, almost a 50% discount to our valuation and over 40% of the market cap supported by cash.
AGYS is in the middle of a turnaround. It lost a bunch money in 2011 and 2012 (YE March 31) and looks like it is about to turn the corner to being profitable. For its September 30, 2012 quarter it reported a loss of $.02 a share on a GAAP basis and made $.06 on a Non-GAAP basis.
MAK Capital One owes about 32% of AGYS and three other funds own about 21% in total.
Gross margins are about 40% and they have $3.53 of cash per share and no debt.
We think this is a BUY here.
There are about 22 million shares outstanding but it trades only about 30,000 shares a day, so patient buying is needed.

About Agilysys:
Agilysys is a leading developer and marketer of proprietary enterprise software, services and solutions to the hospitality and retail industries. The company specializes in market-leading point-of-sale, property management, inventory and procurement, and mobile and wireless solutions that are designed to streamline operations, improve efficiency and enhance the consumer’s experience. Agilysys serves casinos, resorts, hotels, foodservice venues, stadiums, cruise lines, grocery stores, convenience stores, general and specialty retail businesses and partners. Agilysys operates extensively throughout North America, with additional sales and support offices in the United Kingdom, Singapore and Hong Kong.

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