Rivalry in the fading film-camera business is fierce, and small-cap Concord Camera (LENS) has been hit-hard. But some value players are betting big on a comeback: They think Concord is way oversold--down from 9.39 a share in March to 4.95 on Aug. 21--and they see huge promise in its recent licensing of the name Polaroid. "It's a big deal for Concord because it can compete directly with Kodak (EK) and Fuji (FUJIY), with its own camera carrying the Polaroid brand," says Gary Steiner of Awad Asset Management, which owns 12% of the shares. Concord has mostly been an outsourcer--supplying Eastman Kodak and Polaroid with single-use and other cameras. Other customers include Wal-Mart Stores (WMT), Walgreen (WAG), and Eckerd (JCP). Steiner says Concord is selling a greater variety of products to Wal-Mart. Concord is talking to other outfits for private-label business, says Steiner, who sees the stock rising to 12 in a year.
Chris Quilty of Raymond James & Associates, which underwrote a secondary offering for Concord in 2000, says the Polaroid name gives Concord a "much-sought-after weapon to compete in low-end cameras." He figures the name could help Concord generate sales of $100 million over three years. Concord has talked with retailers and could start selling its own Polaroid brand by the end of September. He says Concord, which posted a loss in fiscal 2002 ended June 30, will recover--earning 15 cents a share in 2003 and 35 cents in 2004. The estimates don't include original-equipment business Concord might complete this year. By Gene G. Marcial