ALJ Regional Holdings, Inc (NASDAQ: ALJJ) is a private-equity-style holding company, with a solid history of operations, that currently trades at a 15% free cash flow yield. The stock has suffered a 50% drawdown over the past year, mainly due to a stream of bad news, including ugly quarterly results, fears of a debt covenant breach, NOL’s taking a hit from the tax bill, and a sexual harassment lawsuit filed against the firm’s CEO and key capital allocator, Jess Ravich (in his role at TCW). The main question is does this negative sentiment match reality?
This document contains an independent analysis of the company. Information on my investment philosophy can be found here. On a side note, I haven’t written much lately as I’ve been busy studying for the CFA Level III exam and interviewing for jobs.