Aker Philadelphia Shipyard (AKPS.OL)
Aker Philadelphia Shipyard is a leading U.S. commercial shipyard constructing vessels for operation in the Jones Act market.
Aker Philadelphia Shipyard ASA was listed on Oslo Axess* in December 2007. Converto Capital Fund AS, an investment fund controlled by Aker ASA, is the majority shareholder, holding 71.2% of the shares.
I was impressed with the CEO’s dialogue in the 2012 annual report. He seems to be shareholder oriented.
“Against the recommendation of counsel, I will mention that our market capitalization still trails significantly behind our book
At year-end, we had a book equity of $98.4 million, but a market capitalization of only $24 million ($36 million on March 15,
2013). A significant portion of our balance sheet is comprised of cash, with only $8.3 million in interest bearing debt after the delivery of the Florida.
You can be sure that we will be shareholder oriented in how we manage our cash going forward, with careful evaluation of operational investments and expenses, and close consideration of how future projects will be financed.”
Alpha Vulture did a post on this company here. Regarding valuation I think he was a little optimistic with regards to future profits. From 2007 to 2012 the book value of the company has hardly increased at all, granted it has been a tough market but that market could continue in the future. I think this is a high risk company and should trade at a small discount to book value.
Unfortunately today the share price has advanced 30% putting it at a price/book ratio of 0.6 which isn’t quite attractive enough for me at the moment. I just would hate going in after a 30% rise. This one is definitely going on the watch list though.
Eastern Virginia Bankshares Inc (NASDAQ:EVBS)
EVB is a community bank targeting small to medium-sized businesses and consumers in traditional coastal plain markets. Their goal is to expand whenever possible when it is financially feasible (but now is not the right time). It also operates EVB Investments, a full-service brokerage firm.
As a result of over 100 years of experience serving the Northern Neck and Middle Peninsula regions, they have a stable, loyal customer base and a high deposit market share in these regions.
The company cannot pay dividends without regulatory approval. They are undergoing a rights issue in 2013 to strengthen the balance sheet and relax these restrictions.
It trades below book value but I’m not even sure that is meaningful for a bank in this environment. Banks will by law be required to keep their balance sheets strongly capitalised, and I think the best way to value banks in future will be the discounted dividends a shareholder will receive. As a result, I can’t see this as a particularly attractive investment at the moment given their earnings.