Key Tronic Corp. has transformed itself from a company once wholly dependent on its keyboard business to one that makes gaming machines, printers, medical devices and satellite control units. It has reported a profit for 22 consecutive quarters. There’s not a dime of debt on the books.
And the stock trades at almost a 50 percent discount compared with that of its competitors.
A heck of a good story, one that until last week the Spokane Valley company had not had much of an opportunity to tell area investors.
Thanks to a first-ever Inland Northwest Investment Forum on Wednesday, Key Tronic, Nighthawk Radiology Holdings Inc., Red Lion Hotels Corp., Itron Inc., and Ambassadors Group Inc. got that chance. Colin Kelly, president of the Spokane Chapter of Certified Financial Analysts, said the organization wanted to raise its own profile, and that of Spokane companies who do not have ready access to the investors, investment advisers, and other financial experts who frequently convene in larger cities.
The CFA succeeded on both counts.
“This was a great forum for us,” said Key Tronic Executive Vice President Ron Klawitter.
He said executives have kept their heads down while reinventing the company. With the transformation largely complete, and Key Tronic well-positioned to take a bigger bite out of the electronic manufacturing business, some self-promotion is in order, he said.
“You’ve got to advertise your company,” Klawitter said. “You have to put some effort into it.”
He said the payback may not be immediate, but his presentation got the attention of Mike Roarke, a vice president with the Seattle investment firm McAdams Wright Ragen. Roarke, a former Spokesman-Review reporter who wrote some good stories in his time, said he left with the opinion Key Tronic “is just a flat-out cheap stock,” and he was intrigued by Red Lion as well.
Roarke said he appreciated the speakers’ candor, especially that of a panel of bankers who did not try to gloss over the challenges facing their industry. RiverBank Executive Vice President Dean Bellamy and Inland Northwest Bank President Randy Fewel, along with U.S. Bank Vice President Greg Conley, stepped up while others ducked for cover.
“I’m glad I made the trip over,” Roarke said.
Craig Hart, who helped organize the event, said early feedback has been “fantastic.”
A decade ago the region did not have enough public companies to make a day full of corporate presentations attractive to investors, said Hart, president of Hart Capital Management Inc.
Hart said he is troubled by indifference among investors to buying individual stocks. More education – giving them a chance to hear company stories directly from the executives, and ask questions – might generate new interest, he said.
Hart and Kelly said they hope to repeat the forum next year, perhaps expanding the list of companies invited to participate and reaching out to a broader audience. The community would be well-served if they can do both. Dynamic companies are the foundation of a vigorous economy.
Many in Spokane fit that profile. And everybody loves a good story.