Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, alcoholic beverage distributor Central European Distribution (CEDC)
With that in mind, let's take a closer look at CEDC's business and see what CAPS investors are saying about the stock right now.
CEDC facts
| Headquarters (Founded) | Mt. Laurel, N.J. (1990) |
| Market Cap | $248 million |
| Industry | Distillers and vintners |
| Trailing-12-Month Revenue | $825.9 million |
| Management | Chairman/CEO William Carey (since 1997) CFO Christopher Biedermann (since 2005) |
| Return on Capital (Average, Past 3 Years) | 3.3% |
| Cash/Debt | $111.2 million / $1.34 billion |
| Competitors |
Diageo |
Sources: S&P Capital IQ and Motley Fool CAPS.
On CAPS, 96% of the 687 members who have rated CEDC believe the stock will outperform the S&P 500 going forward. These bulls include All-Stars tenmiles and TSIF, both of whom are ranked in the top 0.1% of our community.
Just last week, tenmiles tapped CEDC as a timely bargain opportunity: "Spirited decline with goodwill writedowns and trouble in Russia, but believe there may be value here from private equity."
In fact, CEDC sports a particularly paltry forward P/E of 4. That represents a clear discount to industry peers Diageo (13.3), Brown-Forman
CAPS All-Star TSIF elaborates on CEDC's earnings miss last week as a possible buying opportunity:
The guidance is ugly, anywhere from a profit to a loss. In reality, however, the news required some interpretation that I don't think some investors took time to give it. The quarterly operating loss of $645 Million included $674 Million of non-cash impairment charges against goodwill and trademarks. The vodka in inventory remains secure. ... The expansion into Europe has been costly and the debt excessive, but overall, the European market should be ready to drink their sorrows as the Eurozone implodes.
The company appears to be cutting some corners and trying to improve pricing and input costs. ... I'm willing to give them some benefit of the doubt that they can sell a recession proof product with a strong brand name in sufficient volume to make a profit. The proof will be in the next few quarters.
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