Ingram Micro Hits 15-Year High

NEW YORK (TheStreet) -- It was deja vu all over again with Ingram Micro's (IM) fourth-quarter earnings report, which hit the wires after the markets closed on Thursday.

Similar to the final quarter a year earlier, the company beat expectations. Shares rose almost 10% on six times average volume on Friday and now trade at a 15-year high.

Fourth-quarter revenue at Ingram -- the world's largest wholesale distributor of information-technology products -- rose 4% to $11.83 billion, just above the $11.53 billion estimate of analysts. Earnings of 88 cents per share were well ahead of the 78 cent estimate of analysts, a nice surprise from Ingram, which is a high-revenue but low profit margin business.

The company's acquisition of mobile-services provider Brightpoint for $650 million in 2012 has been paying dividends. According to Ingram, the deal added 35 cents to earnings last year, a penny higher than what was originally expected.

Ingram has been a staple on some of my deep value-related stock screens for several years, frequently trading below its net current asset value (net/net). It was also one of the biggest net/nets in terms of market cap that I'd discovered in the umpteen years that I've researched and written on that topic.

It has also been a great lesson in the patience required for deep-value investment success; the stock traded sideways during the first couple of years that I owned it, before breaking out last year.

Despite its run-up, Ingram's stock is still cheap on several measures. Shares trade at about 1.78 times the company's net current asset value, which keeps Ingram in my "double-net" category -- a self-made term for companies trading between 1 and 2 times net current asset value. Furthermore, it trades at less than 1.5 times tangible book value per share.

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