KVH Industries Inc.
(NYSE:KVHI) shares moved up $0.24, or 2.82%, to $8.76 today after
Roumell Asset Management disclosed an 8.31% stake in the company and
urged the company to explore a share buyback. The activist hedge fund
insists that the company remains extremely undervalued and that the
company (along with other investors) should consider investment.
Roumell
Asset Management encouraged the company to weigh any acquisition
opportunities against the compelling investment opportunity present in
buying their own shares at its current levels. After all, a staggering
40% of the company's market cap is in cash while the enterprise value
to sales ratio is less than 1x. Meanwhile, they are generating plenty
of cash flow on strong business and defense programs only provide more
reason for optimism.
Overall, the company is clearly undervalued
and that is ample reason for the company to explore buying its own
shares as opposed to an overpriced acquisition. Meanwhile, the company
is definitely one to watch for other investors looking for undervalued
opportunities. Combined, these factors make KVHI a stock
worth watching!
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