Welcome viewers from Germany! I had 158 views in one day and I hope you enjoyed reading. Today I am back looking for another Value investing stock pick. My search led me to Mallinckrodt Pharmaceuticals PLC (Symbol MNK).

Dow Jones Industrial Average 18,003.75 (UP) week ending 04-22-2016

I decided that my goal now is to become the "Peter Lynch of Value Investing" and to pick out 75 to 100  good value stock investments. No small task indeed.

This week I have picked out a Mid-Cap Value International investment. Mallinckrodt Pharmaceuticals PLC (Symbol MNK, $66.27) Yeah, it would have been nice if I picked this one out 30 days ago when the price was lower but I think there is still plenty of room on the upside with this one. 

This stock is not without controversy though. It was shorted back it March by that blogger, which will remain unnamed, that likes to short a company's stock and then trash them in the press by creating doubts about what the company is doing at the present time. Well my blog is based on the facts as presented by the numbers presented in the company's audited financial reports, not on presumptions and innuendo.

...and here is what the numbers tell me:

First, MNK is trading at 1.47 of current book value. Earnings per share for this year are projected at $8.05 per share and for next year $8.77 per share. EPS quarter over quarter are up 34.3%.So the forward PE on this stock is 7.07 at the current price. The stock was trading last August, (2015), at $125.00 per share.

The price to free cash flow is 7.31 and I prefer it to be 10 or under. My traditional measurements of PEG and ROE are 1.77 and 10.20, so both a small bit out of my comfort zone. The Current ratio is 1.80 and the Quick is 1.50 both are fine. I had blogged about a stock earlier this year with similar dynamics an story which was Lannett Pharmaceuticals, (LCI), which I also still like and own.

MNK is 92.6 % institutional owned with T. Rowe Price and the Vanguard Mid Cap Fund firmly committed to the company and it shares. The company has a target price of $93.00.  Sales quarter over quarter have been up 19.10% and for the past 5 years have been up 10.30% annually. The stock just broke thorough its 50 Day Moving average to the upside. 

What do the Analyst think about the stock of this company based in Dublin, Ireland where they have the low corporate tax rates?  13 Buy and 3 Hold. 

Many of the Gurus have owned this one. Ken Heebner, Joel Greenblatt, George Soros, Mario Gabelli, David Dreman and John Paulson according to Gurufocus.com.

The Investors Business Daily earnings ranking on this stock and sector is 91 and "A" and they are ranked 4th overall in their group. I just think it would be a good acquisition to purchase some shares for a 2 to 3 year buy and hold purchase. I think that you will be well rewarded.

Besides, you can always go and see Dublin at the shareholders meeting. You need to get away sometimes, don't you?

Best wishes for good investing and good health, Sláinte !

Freewilly

"Yellen, Chair of the Federal Reserve and Economist, holds off on an interest rate hike and the market is smiling for a change. Here are a few value investment ideas and a couple of Bio-tech speculative picks for you."

Dow Jones Industrial Average 17,792.75 (Up) Week ending 04-01-2016

Sorry for being away and not writing my blog. My paying job gets ranked first in the pecking order and I was also traveling. The markets have filled back in nicely here, but there are still some bargains to be found out there. 

One company that I like based on my value criteria is JetBlue Airways Corp. (Symbol JBLU, $21.33). I had purchased this stock before I had heard any rumors about an interest in Virgin America Airways. This company has a current PE or 10.83 and a forward PE of 8.55.

The company is projecting earnings of $1.97 per share for 2016 and $2.49 per share for 2017.  Q/Q earnings were up 115.40% and the Sales Q/Q are up + 10.2 % . The company operates at Gross Margins of 68.7%.

JetBlue fits well with my investment parameters with a PEG Ratio of 0.32 and a Return on Equity of 23.10%. The company pays no dividend currently.

The company trades at a price to Book value P/B of 2.12 to 1 and trades at price to forward cash flow of 10.42. I like companies that trade at less than 3 Times current book value , (P/B),  and with a P/FCF of under 10.00. 

My next pick is a Closed-End management fund named , Tekla Healthcare Investors (Symbol HQH, $24.52) located in Boston, MA. First off, the fund boost a dividend yield of 9.95% and they reinvest your dividend in more shares so you have a compounding effect with your money. 

The fund has a PE of 8.9 and produced earnings of $2.76 per share. 

The thing I really like is that this fund trades at a Price to Current book value of 0.85 (P/B). So if they ever liquidated the fund you would have an instant 15% gain. The fund currently has a Return on Equity of 30.60. 

Quarter over quarter sales were up 170% and EPS for the last 5 years ave averaged 27% gain year. 

......... And now for some fun speculative Biotech-Pharma picks for you. This is for money that you would spend on the lottery or gamble at the casino, money that you could sustain a loss on with these investments. I own a little each of these.

Depomed (Symbol DEPO, $14.38).  Depomed is a specialty pharmaceutical company focused on pain management and other central nervous system conditions. Depomed has sales and products already to market and have a 5 Year growth rate of 33.52%. They just had their patents upheld in court against Purdue Pharmaceuticals.

Egalet (Symbol EGLT, $6.89). 

First of all the company is holding $5.81 per share in cash on the balance sheet so you are getting the rest of the company for practically nothing. "Egalet, is a fully integrated specialty pharmaceutical company, focused on developing and commercializing medicines for patients with moderate to severe pain. It has the first and only approved immediate-release oxycodone product formulated to deter abuse via snorting, for the management of acute and chronic moderate to severe pain where the use of an opioid analgesic is appropriate." Quarter over Quarter Sales/Revenue is +387.30% and next year earnings are projected to be up 63.7%. Analysts have a target price for EGLT of $18.20. and chronic pain while helping to protect physicians, families, and communities from the burden of abuse.

Flexion Therapeutics, Inc. (Symbol FLXN, $9.42) is the most speculative pick of the three picks because they do not have a product to market yet so no sales revenue.  "Flexion Therapeutics is a specialty pharmaceutical company focused on the development and commercialization of novel non-opioid pain therapies. The company is currently advancing a portfolio of injectable drug candidates that have the potential to provide better and more persistent analgesia compared with existing therapies." They are very well financed with a Current Ratio of 13.80. The price to Book value P/B is 1.95. The target price by analysts on the stock is $35.50 per share. Be careful with any of these three. They are to add a small position to your already well invested and diversified portfolio.

NCAA Final Four college basketball tonight here is the USA.  Go Villanova Wildcats, our local Philadelphia, PA. entrant in the fray.

Freewilly