Company

Healthcare / Drugs

China (Serves local market)

Revenue Sources

• Anemia treatment (stimulates production of red blood cells)
• Platelet deficiency treatment (stimulates platelet production)
• Intefen anti-cancer
• Low white blood cell count (due to chemotherapy) treatment (licensed tech. from Liaoning Sunshine)

Long Term Prospects

Unknown

• Is there competition for similar products in China?
• Similar products from foreign producers?

Management

Unknown

Financial Strength

Strong

• No Debt
• 112.6m in cash
• Steady Cash Flow
• $6 net capital/share

Capital Structure

Strong

• No Debt

Dividends & Growth

Fair

• No dividends
• Volatile stock price
• High of 16 in TTM (trailing twelve months)

Bottom Line

• Tons of cash
• No costs
• Small = Volatile

Ituran Location and Control Ltd. (Ituran) is mainly engaged in the area of location-based services, consisting of stolen vehicle recovery and tracking services. (Reuters).

Not in my area of expertise (thus long term prospects need comment from someone who knows this business).

Long Term Prospects

Two main businesses: Fleet Management (shipping trucks) & stolen vehicle recovery tracking (personal & commercial).

The Good

• Subscriber base is growing (up 12% from 2006)
• Net Profit for 4Q2007 was $6.2m vs. $5.1m from 4Q2006 (with Telematics 35.8m sale income removed).
• Sold Telematics business ($35.8m net income) & shared profit thru dividend of $1.34/share

The Bad

• Increases in revenues came partially from purchases of ERM & MAPA businesses.

Fleet Management is a new technology that is improving efficiency of delivery & quality of service to end customers.  Imagine UPS/Fedex being able to track its fleet of delivery trucks to determine when a delivery will be made. Basically a tool for supply chain management & logistics.

Personal stolen vehicle recovery services: not a huge market.  The average car owner has insurance which covers loss. Reduction in premiums for insurance likely don’t offset the ongoing costs of this service. Thus a small market for a specialized service. Discretionary spending product.  People need to eat.  People don’t need to track their car by satellite GPS in order to live.

Is ITRN a leader in its industry?

Does it have competition? LoJack (NASDAQ:LOJN)

How does it grow?

Management Performance

Positive cash flow for ITRN since 2004.

Pays a dividend.

… to be continued.