1. Archive

A conservative, high-quality thrift

Steve Halpern regularly reviews more than 400 stock market newsletters and services, choosing what he believes to be the most interesting or informed recommendations for inclusion in this column and his own newsletter, the Dick Davis Digest. For subscription information or further details call (800) 654-1514.

FFLC Bancorp

Headquarters: Leesburg

OTC (Symbol: FFLC)

52-week range: $12.75-$14.25

Friday's close: $14

"FFLC Bancorp is the holding company for First Federal Savings Bank of Lake County, a $300-million thrift based in Leesburg. It serves Lake and Sumter counties through six full-service offices.

"Lake County is just north of the burgeoning I-4 corridor connecting Tampa and Orlando, and its southern portion is a rapidly growing bedroom community. First Federal is a conservative, high-quality thrift in an attractive market; founded in 1934, it has deep roots in the community. It concentrates on single-family mortgages, home construction, and home-equity lines. Asset quality has been outstanding due to its intimate knowledge of the market.

"It recently completed its conversion to stockholder ownership, with the sale of 2.8-million shares at $10 each. The firm pays a 24-cent annual dividend, with the ability to raise it regularly in future years. It also has ample funds for a stock-repurchase program.

"First Federal has extremely low risk in its balance sheet and loan portfolio. It's an attractive long-term investment for total return. Buy under 16, with a target of 20 in the next 18 months."

Samuel Beebe

Robert W. Baird & Co.

Sensormatic Electronics

Headquarters: Deerfield Beach

NYSE (Symbol: SRM)

52-week range: $20.50-$37.37{

Friday's close: $34.75

"While violent crimes grab the headlines, shoplifting is far more common.

"Sensormatic is the leader in combatting shoplifting; its bread and butter is the electronic-surveillance business, whereby tags attached to merchandise either set off alarms when removed from the store or release ink when someone tries to remove the tag. (Its systems even prevent the unauthorized removal of babies from hospitals!)

"New customers include Kmart and Home Depot. Sensormatic is also the world's largest retailer of closed-circuit TV systems.

"Sales and earnings are on a growth track. The firm pays a 20-cent annual dividend, and the stock's relative performance is positive. If you want to profit from crime prevention, consider Sensormatic. It's a buy."

Carlton Lutts

The Cabot Market Letter

Salem, Mass.

Royal Caribbean Cruises Ltd.

Headquarters: Miami

NYSE (Symbol: RCL)

52-week range: $15.62|-$29

Friday's close: $26.87{

"Royal Caribbean has an upscale presence in the cruise market. That, combined with positive industry dynamics, should allow modest yield improvements to complement increased capacity and higher margins.

"We project earnings will rise 11 percent to $2 a share in 1994, and 15 percent to $2.30 the following year.

"The number of passengers in 1993 was on target, while margins were better than expected. We expect positive trends to continue into 1995. Three more ships are expected through 1997, increasing berth capacity by 52 percent.

"We reiterate our buy rating, with a 12-month target of 35."

Paul Mackey

Dean Witter

Engle Homes

Headquarters: Boca Raton

OTC (Symbol: ENGL)

52-week range: $9-$17.50

Friday's close: $16.25

"Engle is one of the state's top home builders, with developments in South Florida, Orlando and the Tampa Bay area. The firm recently settled a dispute over its planned Pembroke Meadows development in Broward, and construction should begin later this year.

"Fully diluted earnings for the quarter ended Jan. 31 rose 40 percent to 28 cents a share; revenues jumped 64 percent to $46-million. The acquisition of the Pembroke Meadows property adds significantly to Engle's land position, making future prospects extremely bright.

"The firm is positioned in a number of strong communities. The stock is a buy."

John Blackwell

Ladenburg Thalmann & Co.