Q: ECN capital got back to positive EPS in the last quarter (3 cents). The share price is breaking out today. Management is still guiding for 10 to 16 cents of EPS for the year. In the background is the chance to their partner in the manufactured home financing (triad) could do a take over of ecN (not a sufficient reason the buy on its own but another positive possibliity). And combining a good chance for lower interest rates which I believe would help ecN makes me want to add to my small position in ecN. What is you read on the earnings and do you concur that it is time to add to a ecN position?
5i Research Answer:
We have comments on the quarter posted in the Q&A. While it is cheap, and a takeover is not beyond possibility, we would highly doubt it at current valuations, even with a big premium. Mr. Hudson is very wealthy and he has the time to turn this around to try and get a better valuation for shares. The stock is cheap, but we would like to see some more consistent momentum and perhaps another good quarter before stepping up.