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ARC: Generating Copious Free Cash Flow While Waiting for a Market Upturn, Enhanced B/S Flexibility Enables Increased...

February 22nd, 2012

We cannot think of a better testament to the skill and guile of ARC’s current management team than the chart below.  In it we compare ARC’s aggregate free cash flow generation over the past five...

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ARC: Our Revised Estimates

May 4th, 2011

Our Revised EstimatesARC’s 1Q11 results were more or less inline with our expectations after adjusting for accelerated amortization of trade names and costs associated with elimination of the company’s interest rate swaps as a result of the company’s debt refinancing.  Recent...

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ARC: At Long Last Some Cyclical Tailwinds for the Reprographics Industry?

February 22nd, 2011

After slogging through three brutal years of weak demand for non-residential construction services, it appears that ARC might finally start to benefit from a recovery in project activity in 2011. Suddenly signs of life in the commercial real...

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ARP: Checks with Independent Reprographers Confirm Weakness Continued into 3Q, Analyzing ARP's Covenant Compliance

November 1st, 2010

As early as April of this year, we argued that the revenue trends in the reprographics industry were on the cusp of stabilization, if not recovery.  Obviously we have been a little bit early in our call,...

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ARP: Quick Thoughts on ARP's Earnings Results, Our Revised Estimates, ARP's Secular Growth Strategy Starts to Emerge

August 4th, 2010

Obviously this is an earnings call we did not get right. In our preview of the quarter, we argued that ARP was poised to deliver revenue and earnings upside for the second quarter based in large part on...

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Finally a Bottom in the Reprographics Industry? Channel Checks Suggest So, ARP Positioned for a Solid Q2 Beat

July 28th, 2010

In April, we argued that the reprographics industry was showing signs of imminent revenue stabilization, despite what continued to be weakness in the macro-economic data related to non-residential construction...

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Reprographics Industry Slowly Stabilizing, ARP On Track for 2010 FCF of $60MM, More Insights on BIM's Impact

April 8th, 2010

We recently conducted a survey of 30-35 independent reprographers to gain a better understanding of industry-wide trends during 1Q10, their outlook for 2Q10 and the rest of 2010, and how BIM has impacted the...

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Conversations with ARP Management: Answering the BIM Question

March 25th, 2010

We recently had the opportunity to speak with senior management of ARP.  Although we discussed a number of issues that will impact ARP shares in the near-term, our primary focus was on the strategic direction of the company in light of the increased usage...

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ARP Raises Guidance for 4Q09 Revenues, EPS – Consensus Estimates Appear Too Low for 2010

March 12th, 2010

This report was originally published on 1/27/10.After the close today, ARP (7.65 ↓1.80%) issued a press release indicating that the company now expects to beat its prior revenue and EPS guidance for 4Q09.  You can read the...

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Feedback from Independent Reprographers Suggests the Potential for ARP to Beat Estimates is High, AIA Billings Index...

March 12th, 2010

This report was originally published on 1/20/10.We introduced ARP (7.64 ↓1.93%)as an investment idea approximately 9-months ago. At that time we thought the stock had considerable upside based in...

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Canon’s Takeover Bid for Oce N.V. Validates Value of ARP Shares

March 11th, 2010

This report was originally published on 11/16/09.CanonInc. today announced its intention to launch a takeover bid for Oce N.V., a leading manufacturer of digital printing systems and document management service provider.  Canon (CAJ 44.5...

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ARP’s Revenue “Air-Pocket”, FCF Is Still Impressive, The Outlook from Reprographers

March 10th, 2010

This report was originally published 10/6/09.ARP shares are off sharply today in response to a press release in which the company announced it was lowering guidance for the year and had recently completed an amendment to its...

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Despite Weakness in the AIA Billings Index, Channel Checks Suggest Another Quarter of Upside Out of ARP – Looking at...

March 10th, 2010

This report was originally published 7/31/09.We continue to recommend purchase of ARP shares, even after the 50% gain in the stock since we first introduced the idea.  The company will report...

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Recent Correction in ARP Shares Brings the FCF Yield Back to 20%+

March 8th, 2010

This report was originally published on 6/24/09.Since reaching its YTD high of $10.11 on June 5, ARP shares have witnessed a 20% correction. At today’s price, ARP shares now sport a free cash flow (FCF) yield of 20%. After generating $20 million in FCF...

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AIA Architecture Billings Index for April 2009 Supportive of Our Free Cash Flow Outlook for ARP

March 8th, 2010

This report was originally published on 5/20/09.The American Institute of Architects (AIA) released their Architecture Billings Index (ABI) for April 2009 today. Overall, the ABI index has been proven to be a solid indicator...

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ARP is a Cash Cow. If That’s the Worst of It, We’ll Take All We Can Get

March 7th, 2010

This report was originally published on 5/7/09.ARP reported 1Q09 results after the close. You can read the detail here. The quick highlights are as follows: Revenues were inline with street consensus, but the company had clear positive...

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Comments from a Reprographics Industry Veteran

March 7th, 2010

This report was originally published on 5/6/09.We had the opportunity to speak with a three-decade veteran of the reprographics industry to get a better sense of his views on the state of the marketplace, the competitive landscape, consolidation opportunities, and the...

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ARP is a Cash Cow

March 7th, 2010

First and foremost, we do not want our enthusiasm for ARP shares to be misconstrued as a bullish call on construction spending or commercial real estate. We have been followers of American Reprographics Companysince its IPO. The company is the unequivocal leader in the $4.5 billion, highly fragmented...

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