"I find more and more that it is well to be on the side of the minority, since it is always the more intelligent" Goethe

July 07, 2013

New long term investment idea

I've been writing a series of posts on some long term investment ideas.  This unknown software as a service stock (SaaS) specializing in eDiscovery.  The following is the description of the company from their website:

Epiq Systems is a leading global provider of technology-enabled solutions for electronic discovery, bankruptcy and class action administration. We offer full-service capabilities to support litigation, investigations, financial transactions, regulatory compliance and other legal matters. Our innovative technology and services, combined with deep subject-matter expertise, provide reliable solutions for the professionals we serve.

The long term chart is a beauty.  We are in roughly year 12 of base on base action!  A huge buy signal fires over 15.   

They had 24% growth of their core business YoY in Q1.  On top of that, the company pays a 2.6% dividend. 

My main area of concern is future dividend payments.  The balance sheet is pretty fluffy with over 80% of their assets in goodwill and accounts receivable.  That said, operating cash flow is consistently growing each year with 50% growth in 2012 vs 2011.      

At the end of the day this looks like a fantastic investment with the raging bull market in court proceedings!  


All ideas shown on this blog represent the authors opinion based on the data available.