Screener C – March 28, 2025

1 Federal Agricultural Mortgage Corp (AGM) – remains on list

First appearing on Screener C in March 2025 (Y250321) Federal Agricultural Mortgage Corp. (Farmer Mac – AGM) is a publicly owned, federally chartered corporation combining public sponsorship and shareholder capital to serve a public purpose. The Washington DC based company purchases and services eligible loans directly from lenders, guarantees and purchases securities issued by lenders that are secured by pools of eligible loans (AgVantage), and issues and guarantees securities that represent interests in pools of eligible loans (tFarmer Mac Guaranteed Securities). Revenues and earnings have grown at nearly the same rate over the past 5 years, averaging 14% – 13% YoY. The company pays a dividend currently yielding ~2.9%, but has not repurchased a meaningful amount of common stock.

2 CleanSpark Inc (CLSK) – remains on list

First appearing on the list in February 2025 (Y250228) CleanSpark is a bitcoin mining company, meaning the company acquires customized computer resources, configures the specialty computers to support the bitcoin blockchain, and collects bitcoins in return for the energy intensive computer resources applied to the network. The Nevada headquartered company was founded in 2014, has ~250 employees and operates primarily in southern U.S. states. Revenues at the company have been volatile, but have essentially tripled from 2020 to 2024 while earnings have consistently been negative (below zero). The company has funded itself with an increasing pace of common stock issuance and approximately $650mm in long-term debt.

3 Marqeta Inc (MQ) – new this week

First on our radar in April 2023 (Y230422) and floating around the $2.0bn market capitalization level for some time, Marqeta offers a cloud-based tech platform for creating customized card payment programs. Customers can launch and manage their own card programs, issue cards, and authorize and settle transactions by embedding Marqueta’s technology in their app or website. The company was founded in 2009 and went public via IPO in 2021 at roughly a $15bn market valuation. The Oakland, CA headquartered company has office in the U.S., U.K, and Australia. Revenues in 2023 were below 2022 levels by about 10% however Marqeta has no debt. The company is unprofitable after operating expenses and has seen increasing losses in FY23 compared to FY22. Recently the company has been hit with a few shareholder lawsuits and the majority of senior management has turned over.

4 Advance Auto Parts Inc (AAP) – remains on list

First appearing on the list in March 2025 (Y250307) Advance Auto Parts, Inc is a retailer of aftermarket auto parts and accessories serving both retail and commercial customers. As of December 2023, the Raleigh, NC headquartered company operated 4,786 stores and 321 branch locations in North America under the Advance Auto Parts, Autopart International, Carquest, and Worldpac brands. Over the past 10 years, top line sales have grown on average ~8.0% while earnings have grown in parallel, in the high single-digit percent YoY. More recently, management has announced plans to exit several major markets, close hundreds of location and effect a significant restructuring of the company’s operations and footprint. The price of the common stock has fallen considerably in the past few years as competing auto part companies have taken market share. Interest coverage is tight, at around ~1.4x at year end 2024 with debt representing almost 50% of the capital structure. The company has not been repurchasing stock, and has reduced the dividend, which now yields common stock holders around ~2.5%.

5 Harley-Davidson Inc (HOG) – remains on list

First appearing on the list in October 2023 (Y231029) and intermittently thereafter, Harley-Davidson manufacturers motorcycles, motorcycle parts, accessories and apparel. Based in Milwaukee, WI, the company is one of the leading motorcycle manufacturers in the world and is well-recognized for it’s iconic brand. The parent company consists of a manufacturing company (HDMC), a financing business (HDFS) and a majority stake in LiveWire a U.S. electric motorcycle company. Sales have essentially been stable over the past 10 years, excluding 2020 when supply chain shocks and consumer demand hit particularly hard. The common stock pays a dividend and the company has been repurchasing some shares over the past two years. Management has been very focused on cost cutting and maintaining profitability, while higher interest rates have materially pressured recreation industry participants.

6 Icahn Enterprises (IEP) – remains on list

First appearing on the list in May 2023 (Y230528), Icahn Enterprises is a diversified holding company with business units in investment, energy, auto, food packaging, real estate, home fashion and pharma. Structurally, the company is an MLP headquartered in Florida with Carl Icahn, a well-known investor, owning 86% of the entity. In reality, the company is similar to a publicly traded private investment fund operated by Icahn. In past years, the company has paid high dividends to shareholders. Icahn’s investment strategy has historically been value-oriented and spans distressed credit, special situations, buyouts and activist positions. Within the recent past the holding company has come under fire from short sellers, alleging the fund inflated asset values and used the inflated values to borrow money to fund the high dividend.

7 QXO Inc (QXO) – remains on list

QXO (formerly Silversun Technologies, Inc. – SSNT) is a value-added reseller (VAR) of business software, offering solutions for accounting, business management, financial reporting, managed services, and other services to small and medium businesses. This business has recently transformed through an inventive transaction led by Brad Jacobs, the founder of United Waste Systems (now Waste Management), United Rentals, and other companies. The transaction was completed in June 2024, with Jacobs becoming CEO and board chairman, effectively transforming Silversun (with a previous market cap below $20mm) into a reorganized QXO with a large cash infusion. The company’s strategy is now to become tech-forward leader in the building products distribution industry via accretive acquisitions and organic growth.

8 Lucid Group Inc (LCID) – remains on list

First appearing on the list in October 2023 (Y231029) and intermittently thereafter, Lucid is an electric vehicle manufacturer. The Newark, CA based company is recognized for having superior powertrain and battery technology, with their sedan model Lucid Air having over 500 miles on a single charge. Lucid was founded in 2007, went public via SPAC merger in 2021, and has a leading investment from Saudi Arabia’s sovereign wealth fund (PIF) who owns +60% of the common stock. The company has had challenges scaling and realizing production / deliveries, as they design and build most all systems in-house using their own equipment and factories. The capital intensity and competitive dynamics of the industry have put immense pressure on profitability. Gross profit, free cash flow, and net income are all deeply negative.

9 Jefferies Financial Group Inc (JEF) – remains on list

First appearing on the list in April 2023 (Y230422) Jefferies Financial Group Inc is an investment bank and financial services company. The company’s financial services arm includes Jefferies, Leucadia Asset Man., Berkadia, and FXCM. The New York, NY headquartered company pays a small dividend and has been repurchasing stock consistently over the past few years. Although volatile, revenues have grown in the mid-teens on average over the past 10 years, while earnings have essentially grown at the same pace. Company officers and directors own over 20% of common stock.

10 Moderna Inc (MRNA) – remains on list

Intermittently on and off the list throughout 2023 and 2024. Moderna is a biotechnology company that researches and develops drugs. Headquartered in Cambridge, MA the company’s drugs are based on Messenger RNA (mRNA) – a key component studied within the field of molecular biology and used to deliver vaccine solutions for the COVID-19 pandemic. The company’s revenue is purely from their COVID-19 vaccine although they have recently gained FDA approval for a vaccine intended to treat RSV (respiratory syncytial virus). The company went public in December 2018 and has only achieved profitability on a GAAP basis for FY 2021 and 2022. Revenues have collapsed sharply since their 2022 high. Some believe mRNA can be used to create new medicine classes and drugs with the potential to materially improve human lives and open entirely new markets.

11 Hewlett Packard Enterprise Co (HPE) – remains on list

Appearing for the first time on this screen in December 2024, Hewlett Packard Enterprise Co provides computer hardware, software, and services for businesses and cloud / hybrid-cloud deployments. The San Jose, California company was originally spun out of Hewlett-Packard in 2015 and has recently gained attention for it’s AI-related infrastructure that is more tailored to enterprise clients than other computer hardware competitors. Revenues and earnings have been relatively flat for the past 7 years. HP pays a consistent dividend, has not repurchased stock, and has a comparatively low PE multiple for the computer hardware / IT sector. The company is in the process of acquiring Juniper Networks – intended to compliment and scale the company’s existing networking business.

12 Synchrony Financial (SYF) – remains on list

First appearing on the list in April 2023 (Y230422) Synchrony Financial is a retail finance company with its core business in managing private-label credit cards for partnered businesses. The Stamford, CT headquartered company has ~16,500 employees and offers a wide range of consumer credit products through programs with other retailers, merchants, manufacturers and associations. Business segments include Home & Auto, (26% of purchase volume); Digital, (30%); Diversified & Value, (23%); Health & Wellness, (16%), and Lifestyle (5%). Synchrony is the former consumer lending arm of GE capital. The company had an initial IPO in July 2014 and thereafter became a stand-alone company in November the following year. Management has consistently repurchased a significant amount of stock over the past 10 years, with diluted share count decreasing by over 50% since 2015, and pays a consistent cash dividend.

13 United Airlines Holdings Inc (UAL) – remains on list

First appearing on the list in September 2023 (Y230916) United Airlines (formerly United Continental Holdings, Inc.) is a U.S. airline operating over +4,900 daily flights to +370 airports. The Delaware incorporated company operates ~1,358 aircraft (majority leased) with hubs in Newark, Chicago, Denver, Los Angeles, Guam, San Francisco, and Washington D.C. The company’s revenues have grown on average ~3.5% in the past 10 years, with earning growing faster at ~7.0% on average over the same period. Management has been a net issuer of common stock in the past few years and the company does not pay a dividend.

14 Ford Motor Company (F) – remains on list

First appearing on the list in April 2023 (Y230422) Ford Motor Company is the second-largest U.S. auto maker. The Dearborn, MI based company has ~177,000 employees and owns the Ford and Lincoln brands. Ford vehicle sales represented 12% of U.S. car and truck market in 2023 while foreign sales accounted for 34% of the company’s revenues for that year. Ford also engages in vehicle leasing and rental services via their Financial Services Group including Ford Motor Credit and U.S. Leasing. Revenues have been essentially flat over the past 10 years, while earnings have been shrinking at ~8% on average over that time. The company has over $100bn in principal amount of outstanding debt. The capital structure is roughly composed of ~70% IOUs with respect to the recent price of the common stock. Interest coverage is understandably tight, at a level well under 2.0x. Management has not repurchased a material amount of stock, however the company pays a high dividend, currently yielding near 6.0%.

15 General Motors Company (GM) – remains on list

First appearing on the list in April 2023 (Y230429) General Motors is the largest automobile manufacturer in the U.S. with GM sales representing +16% of the U.S. car and truck market in 2023. GM has ~163,000 employees and manufactures vehicles in +30 countries with sales in +120 nations. ~19% of revenues were generated outside of North America in 2023. Brands include Buick, Cadillac, Chevrolet, and GMC among others. Revenues have been essentially flat over the past 10 years, while earnings have been growing ~7% on average over that time. Management has repurchased a measurable amount of stock in the past few years, however the company pays a much smaller dividend relative to other U.S. auto manufacturers.

Interpreting results

Broadly this is an output of U.S. companies with a current market equity value above $2.0bn, a moderately low market price relative to GAAP book value, and moderately low share price relative to cash per share. When compared to our YTB screens, screener C will identify smaller companies often related to financial services or related industries because of our price to cash threshold.

The output generally produces potential targets that require a particularly high level of analysis. Operating models and capital structures of anything on screener C need particular scrutiny. Every so often, we find an interesting company that is facing temporary challenges and / or circumstantial headwinds. These instances warrant timely and careful investigation.

Why this screen can be helpful

We find watching this output over time, allows us to quickly identify potential companies or situations to investigate further, augments the weekly Value Line publication well, and keeps us informed on the less-loved corners of the public markets without having to watch misleading charts or spin our wheels on short-term market movements.  We like to observe new entrants and subsequent exits to the list, over time, and share with our trusted readers.