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Cass to Benefit From Shipping Slump

Stocks in this article: CASS TTEC WXS

The shipping industry is being pinched from lower consumer spending. Companies implementing cost-cutting plans will look to Cass Information Systems (CASS) and its rivals to analyze and audit freight payment, hoping to save money. Ratings gives Cass a "buy." St. Louis-based Cass, whose roots date back to 1906, provides payment and information processing services to companies across the U.S. The company uses proprietary software to simplify operations and reduce costs. It also offers freight invoice rating, payment processing for utility- and facility-related expenses, and commercial-banking services.

Those services are in demand as companies, particularly shippers, seek to cut costs amid an economic recession. Larger supply-chain management firms offer broad and expensive consulting projects, while Cass provides specific services and immediate savings.

Cass is also a leader in utility-payment outsourcing and can offer quantifiable savings for businesses seeking to lower energy costs. The company has proprietary systems to reduce and control telecommunication expenses as well. Cass Commercial Bank is well-positioned to succeed as a lender because it has access to companies' accounting information and can therefore identify ways for them to become more efficient and repay loans.

Many other firms in the outsourced services sub-industry, including privately owned Data2Logistics and TranzAct Technologies, are reporting a jump in business. Cass is an attractive target for a large consulting or supply-chain management firm because of its relevance during trying economic conditions. The stock hasn't received much publicity because of the company's size. It has a market capitalization of $311 million, placing it just above the micro-cap threshold.

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