ASEI - Can They Keep It Up?

American Science & Engineering Inc (ASEI) - Another very interesting company. They create scanning and x-ray equipment for airports and helping homeland security. They have had pricing power, but that may be waning as OSIS and LLL have competing products. Here are some highlights from the recent quarter:

• They did have a blowout 2005-06. Sales were up Y o Y close to 50%.
• They do have some debt, but not a big deal with a current ratio over 5.00
• The stock price is $61.35 vs a 52 week range of $35.95 to $93.86
• 11% Earnings Yield and 75% to 100% ROC

They are a "smaller" cap company with a market cap of $500m. Looks like a solid company, the big question mark is whether future earnings and margins can hold up? They seem innovative and seems to me that the demand for scanning equipment could go well beyond airports. I could see train stations, Amusement Parks, Stadiums etc going that route in this brave new world.

Currently I would probably go for OVTI over ASEI unless their prices shift significantly over the next two to three weeks.

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