#109: Video Display Corp (VIDE) | David Flood

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  Video Display (VIDE)

The company does video simulation products and video displays.
Simulations for military and aerospace. They’ll also do huge
video display units that can be installed in huge rooms like
NASA.


5.9m Market Cap


Lots of hair on this company. Lots of liabilities. Made 67,000
last year. And loss-making previous 3 years.
Why does David like it?

 


2 reasons:
Price chart hit support and volume dropped off. Accumulation
period. People picking up shares in the stock. CEO owns 49% of the
company. He doesn't want to see the company go under. VIDEO has
been around since 1975 which indicates that it has managed to
struggle along for all these years. They have divested a lot of
their old legacy businesses in 2014. Had expanded over the decades
and "diworsified."

 
Potential Catalysts

Started to move into a new sector - cybersecurity for defense
industry. VIDE has a unit that can test computer systems with
homeland security - this could potentially be a lucrative
business in the future. just finally turned a profit. the future
could be better than in the past.


 
History

VIDE has gone on and off doing well to poor again. The stock goes
up a lot when things are good. nobody is paying attention to the
company, left for dead. nobody talking about the company on stock
boards. Those are the kinds of businesses David likes the most:
No sign of life and nobody cares about the company.


 
Stock Buybacks

VIDE was buying back stock last year in mid-2019.


 
Other Catalysts

Potential for some kind of change due to a very old board of
directors.


 
About David Flood

David runs the blog, Elementary Value, and is a private
value investor based in the UK. His investing approach is
grounded in the fundamental precepts of value investing based
upon Ben Graham’s core concepts of ‘Intrinsic Value’ and ‘Margin
of Safety’. His investment strategy involves looking at both
‘Deep Value and ‘Franchise Value’ situations and using the value
investing framework to analyze the financial and corporate facets
of a given prospective investment.


 
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