Is Argan (AGX) still cheap?

They still have a lot of cash, but the price has run up maybe 50% since this end-of-2015 article:…

I got lucky by buying in March in the 30’s. Now it’s pushing 50. I’m trying to figure out whether to stay in, sell some shares, or sell out completely. I’m inclined to hold for now, or maybe sell off 25%.

Saul, is this a stock you’ve looked at before? It’s fairly obscure, with a market cap of about $725 billion.

It’s fairly obscure, with a market cap of about $725 billion
You wish! At $750BN it wouldn’t be obscure but the world’s largest company.

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Saul, Is Argan a stock you’ve looked at before?

Ed, You’ll get much more interest on the board when you introduce a new company if you tell us about the company, what it does? what field is it in? Its revenue? Is revenue growing? how much? earnings? growing? moat? what you think its prospects are? why? do you like it? why?

I know you linked to an article about it, but your own thoughts will help us evaluate it. Most people won’t bother to click through if they never heard of the company and know nothing about it. It’s just a name to them.

I’m not meaning to criticize your presenting a new stock, just suggesting how you can get a better response.



PS. I’ve never looked at it up to know. Never heard of it.

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Of course I meant $750 million market cap.

I put in a quick post without a lot of my own personal analysis because (1) I thought there was half a chance you (Saul) had already heard of it and (2) I didn’t do a lot of personal analysis, I just read several opinions and I was just starting out buying stocks after a 15-year hiatus.

I first found out about Argan through Joel Greenblatt’s free website, which emphasizes ROIC in its calculation. It’s still listed there, despite its price run-up, even when I screen for stocks with a market cap down to $50 million.

Argan consists of these companies:

Gemma Power Systems - development, design, construction, commissioning and operation of large-scale power projects

Atlantic Projects Company - construction and technical services for power generation, oil & gas, industrial and process industry

Southern Maryland Cable - technology wiring and utility construction solutions

The Roberts Company - Fabrication, construction and plant services for heavy and light industry

(“So it’s a rollup?” you ask, and I have to say, “I guess so. Or you could call it a holding company.”)

The biggest division by far is Gemma Power, and their biggest work is in gas-fired power plants. (My qualm there is if the gas is from fracking, which I am against, and how the decline in fracking is affecting their business. But it’s still instead of coal.)

They pay a $.70 dividend once a year, in October.

More to come, time permitting.

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No more analysis yet, but to my amazement, AGX just had a great quarterly report, and went up another 7-8% today with 5 times its average volume.

I’m not gloating, I’m just pleasantly surprised at my semi-educated (Greenblatt formula), semi-dumb (not much due diligence on my part) luck. Part of the luck is that options are thinly traded on this stock, so I had too much trouble trying to sell any calls.

Actually, if you had bought it any time since 2000 and forgot about it, you’d be very happy right now. But lately, it’s jumped in June, July, and now September.


Argan, Inc. (AGX) today declared a regular cash dividend of $0.70 per share and a special cash dividend of $0.30 per share, for a total cash dividend of $1 per share… [ex-div date 10/14, paid on 10/18].

Rainer Bosselmann, Chairman and CEO, commented, “…our success in finishing the Panda power plant projects in Pennsylvania over the last couple of quarters prompted the Board to declare an additional special dividend of $0.30 per share."

With the stock so high now, I’m wondering if it will stay up. Ideally, though, I hope to wait until 2017 to think about selling any shares, to avoid taking a short-term gain in 2016.