Bullish Penny Stock with Massive Backorders and a 7.5% Monthly Dividend

In the best of times, people don’t like new taxes. During an economic crisis, taxes to improve roads, telecommunications, sewers, and other services are an even tougher sell.
That said, President Obama wants to almost double spending on the U.S. infrastructure over the next six years. The President’s 2013 budget is expected to infuse $476 billion through 2018 into highway, bridge, and mass transit projects.
That’s good news for cash-strapped municipalities. It’s great news for transit equipment makers; many of which are already reporting improving market conditions.
New Flyer Industries Inc. (TSX/NFI) is the leading manufacturer of heavy-duty transit buses in Canada and the United States. The penny stock offers the broadest product line in the industry, including drive systems powered by clean diesel, liquid natural gas, compressed natural gas, and electric trolley, as well as energy-efficient diesel-electric hybrid vehicles.
New Flyer has delivered over 32,000 heavy-duty buses in Canada and the United States, and has manufacturing facilities in Winnipeg, Manitoba, St. Cloud, Minnesota, and Crookston, Minnesota. The penny stock also operates a parts fabrication facility in Elkhart, Indiana.
The penny stock has a market cap of $344.0 million, $10.0 million in cash, short-term liabilities of $208.0 million, total current assets of $229.0 million, and a book value of approximately $8.4. Interestingly, New Flyer also provides a monthly dividend with an annual yield of roughly 7.5%.
Even though New Flyer only had its initial public offering (IPO) at the end of August 2011, the company has already generated a large number of institutional investors. In March 2012, New York-based Coliseum Capital Management, LLC, a privately owned hedge fund, took a 12.6% stake in New Flyer. Franklin Templeton Investments Corp. has a 10.2% interest, and Calgary-based Mawer Investment Management Ltd. has a 14.8% position.
On August 8, New Flyer announced that second-quarter revenue increased by 0.5% to $227.0 million. The penny stock reported net income of $3.6 million in 2012 Q2 increased, compared to a net loss of $7.3 million in the second quarter of 2011.
On October 15, New Flyer announced that its third-quarter backlog increased to 357 units, with a total value of $137.9 million. During the third quarter last year, New Flyer had 12 unit orders valued at $4.3 million.
As noted in the penny stock’s September 17, 2012, press release, the total backlog, combined with the recent order intake, is expected to allow New Flyer to average a production line entry rate of approximately 34 units per week for fiscal 2012. Management expects the line entry rate during the fourth fiscal quarter of 2012 will average approximately 36 units per week.
Since August, New Flyer has received a 95-unit order from the Washington Metro Area Transit Authority, a 45-unit order from the San Francisco Municipal Transportation Authority, and a 90-unit order from the New York City Transit Authority.
New Flyer’s share price has been in an uptrend since its IPO in August 2011. The penny stock’s share price remains bullish as it continues to trade above both the 50- and 200-day moving averages. That said, New Flyer’s share price has been trading in a tight range since mid-August. That could change when the company announces its third-quarter results in early November.
With a strong backlog and ongoing demand from across North America, New Flyer could increase production in 2013; adding value to the penny stock’s bottom line. Further, New Flyer provides an excellent monthly dividend yield.
Despite the turbulent economic climate, New Flyer continues to be an excellent penny stock, with great long-term growth potential.
Source: http://www.pennystockdetectives.com/