The cyclical forces that I am referring to have to do with price deflation within their product lines. This is clearly starting to be felt more in flat panels and computers and some other electronics than it was five years ago. These cycles can come and go, and TGA does insulate itself against them in some ways by product line diversification and the introduction of new lines to preserve profit margins. However, you cannot completely escape price inflation / deflation cycles, in my opinion. These sorts of things are less obvious in a business that has had a rapidly growing customer base such as TGA. However, as growth slows, the cycles will become more obvious in my opinion.
I may be more conservative than you would like - but this could also be a function of our different investment hurdle rates (required return).
In terms of TGA - I am holding this at a cost of under $1.60 at the moment in fact. Purchased in the last 18 months.
TGA Price at posting:
$2.03 Sentiment: Hold Disclosure: Held
