AgJunction Inc (AJX.TO)

He can see this going to the $3.50 level. Has undergone major, major transformation. New management within the last year. Their breakeven costs have gone way down. Good balance sheet. Sold off the agricultural division for about $15 million. No debt.

Company has changed dramatically over the past 9 months. New CEO made changes which he thinks were for the best. Sold all the non-agricultural divisions. Have $13 million in the bank. No debt. Have taken virtually all the costs out. Should be pretty clear sailing after this quarter.

Likes this but has become a little more concerned about it recently. Lost about $30 million last quarter but most of that is in write-downs. Sold off a non-agricultural division for almost $15 million. This gives them enough money for their transition to Kansas City. Management has been buying a lot of shares lately. Has a price target of $3.24, which should take years.

Does not have a consistent track record of being profitable. He wants a company that year after year will give him his 15%-20% growth with a certain amount of predictability to it.

(A Top Pick Feb 16/12. Down 12.63%.) New management came in last fall. Was a little concerned when they decided to move the head office from Calgary to Kansas City because of the costs and elimination of 100 employees. Recently sold their precision operation for $15 million. Could get hit this quarter by write-offs but after that sailing should be somewhat smoother.

Going through huge, huge changes. New CEO. No debt. Cutting workforce from 270 to 170, which will cost them a bunch. Moving HO from Calgary to Kansas City and will lose more employees because of this. Thinks this could be a bad quarter with a lot of write-offs and thinks it could be cheaper. Target price of $3.49.

Moving their head office from Calgary to Kansas which is a cost-cutting measure. Stock has been in decline for about 18 months. Seem to be falling behind on the product cycle curve. Up against much larger competitors.

(Top Pick Nov 3/11, Up 9.38%) This quarter will probably not be good because of the drought in the states. The new CEO had a company that he sold to them in 2005 and so he is acquainted with selling companies and maybe he will sell this one. There may be tax loss selling this year and if they report a loss, then you could get it at a lower level than it is now.

(Market Call Minute) Doesn't like it because not enough consistency to their profitability.

Good company but has been highly leveraged to grain prices. Incorporates GPS systems for precision agriculture. Management has been an issue because they’ve been consistently disappointing on account of their earnings. Earnings and revenues have been pretty lumpy. Just had a new CEO installed who was actually the founder. Expecting some cost reductions and strategic shifts into the agriculture sector. Stock is cheap but he has always had problems with its earnings power.

Have just lowered their guidance because of the drought in the US so revenues should increase by about 10% instead of 25% this year. This will hit profitability. Looks like it will take longer to turn around than he anticipated. He buys companies usually at the end of the year because that is when companies are out-of-favour because of tax loss selling. It could be cheaper in a few months. Still likes it. Clean balance sheet and no debt with a fair bit of money in the bank.