more than meets the eye, page-18

Looks unsustainably cheap, trading on 2x 2009 earnings based on analysts revised forecasts. Have picked up some at current levels.

I would however like to get a better understanding of the earnings risk of these businesses in the event of a significant slowdown in the economy. Advertising/marketing tends to be one of the first things companies cut back during tough times.

That being said, the bulk of earnings comes from direct marketing which I think would tend be more resilient as companies spend more to generate sales. Also, the low valuation does provide a big margin of safety.

Looking forward to the release of end of year results. Hopefully management will paint a positive outlook for 09 and restore some confidence in the stock.