The Deep Value Week – 2025/28
Ownership Change, Proposal to go Private and a New Report
Market: 4
Companies mentioned:
· Art’s Way (ARTW) - Improves profitability in Q2 FY2025 despite ag market slowdown
· Avalon Holdings (AWX) - Anil Choudary Nalluri Discloses 36.5% Ownership Stake
· Fonar (FONR) - Receives Non-Binding Proposal to Go Private from Management-Led Group
· Jewett Cameron (JCTC) - Oregon Community Foundation Sells Shares but Retains 10% Stake & Tariff Turmoil Drives Q3 Loss Despite Operational Adjustments
“Graham’s Geiger counter”
Benjamin Graham suggested that one way to measure the valuation of the overall market was to assess the number of net-nets available. When many such opportunities exist, it indicates a cheap market overall, while their absence suggests that the market is expensive. Today’s net-nets, however, are not the same as Graham’s net-nets. Many are un-investable being Chinese RTO’s, loss-making biopharma’s etc. But we do think it is interesting to follow this number over time, and what percentage of total listed stocks qualify as a “naked” net-net without any type of quality adjustments to make them investable. Below is a net-net screen from Stockopedia.
Art’s Way (ARTW) - Improves profitability in Q2 FY2025 despite ag market slowdown
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Art’s Way Manufacturing reported Q2 FY2025 revenue of $6.34m, down 5.8% YoY, with H1 sales at $11.48m (–7.8%). Despite top-line pressure, gross profit improved 3.8% and operating expenses dropped 15.3% YoY, helping drive a net income of $1.43m (vs. a loss prior year), supported by a $1.15m Employee Retention Credit refund. The Agricultural Products segment saw H1 sales fall 20.7%, but reported $0.53m net income (boosted by a $0.98m credit). Modular Buildings posted strong H1 growth: +23% in sales and $0.9m net income. Management remains cautiously optimistic, citing cyclical bottoming in ag markets and continued momentum in modular construction. EPS for H1 was $0.28 versus –$0.09 YoY.
Avalon Holdings (AWX) - Anil Choudary Nalluri Discloses 36.5% Ownership Stake
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In an amended Schedule 13D filed on July 10, 2025, Anil Choudary Nalluri disclosed beneficial ownership of 1,201,150 shares in Avalon Holdings Corp (NASDAQ: AWX), representing approximately 36.5% of the company’s outstanding stock. The shares were acquired using personal funds for investment purposes. Nalluri retains sole and shared voting and dispositive power over the entire stake.
Fonar (FONR) - Receives Non-Binding Proposal to Go Private from Management-Led Group
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FONAR Corporation (NASDAQ: FONR) has announced that it received a preliminary, non-binding proposal on July 7, 2025, from a group led by Timothy Damadian—CEO and Board member—alongside other insiders and third parties, to take the company private. The offer proposes to acquire all outstanding shares not already held by the group, at a premium of at least 10% to FONAR’s 90-day average trading price prior to July 1. The group currently holds approximately 5.01% of shares. FONAR's board has established a special committee of independent directors to evaluate the proposal. At this stage, no decisions have been made, and there is no certainty that a transaction will proceed.
Jewett Cameron (JCTC) - Oregon Community Foundation Sells Shares but Retains 10% Stake & Tariff Turmoil Drives Q3 Loss Despite Operational Adjustments
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Oregon Community Foundation, a 10% owner of Jewett Cameron Trading Co Ltd (OTC: JCTC), has filed Form 4 disclosing multiple sales of common stock. On July 8–9, 2025, it sold a total of 7,565 shares at an average price around $3.74 per share. Further sales of 6,001 shares were reported on July 10–11, also at similar prices. Following these transactions, the foundation still holds 898,214 shares. All shares were held directly, and no derivative securities were reported.
Jewett-Cameron Trading Company (Nasdaq: JCTC) reported a Q3 2025 net loss of $(0.6)m or $(0.18) per share, compared to a net profit of $0.2m in Q3 2024, amid a 21% YoY revenue decline to $12.6m. The downturn was driven by customer deferrals of imported metal products due to volatile and escalating tariffs on Chinese and metal goods, with steel tariffs doubling to 50% in early June. Gross margin shrank to 15.0% (vs 18.6%) due to higher shipping and tariff costs, while operational efficiencies—including a 20% headcount reduction—lowered OpEx to $2.6m (vs $2.9m). Sales of Lifetime Steel Posts® rose 85%, partially offsetting weakness in pet and cedar product lines. The company continues to sell or lease its $0.57m Hillsboro property and expects ongoing margin pressure through Q4.
The writer may own shares of the companies mentioned. This communication is for informational purposes only. AI helped us with this. Check important info.