Update to CCA Industries (CAW) Stock Recommendation

This post is a quick update to my past recommendation of CCA Industries (AMEX: CAW) made about a month ago.

At that time the price was $3.85/share. Currently after their recent earnings release and dividend announcement the share price has risen to $5.00/share (a 30% increase).

But is it still a good buy? In my opinion, yes.

CCA Industries reported $0.34 EPS through the first 9 months of the year compared to $0.32 EPS for the same period in 2008. In Q4 2008 the company saw a loss of $0.10/share, but I doubt that same outcome will be the case this year. I personally am looking for EPS of -$.01 to $.05 for Q4.

Therefore I’m looking for FY 2009 EPS in the $0.33 -$0.39 range, with gains in FY 2010. And at these levels of earnings the dividend yield of 5.6% is relatively safe.

Bottom line, even if yearly earnings only gradually increase from current levels, and never return to the recent average of $0.70/share this company is a buy below $6/share.