Western Sizzlin (WSZL) just issued a press release announcing that its stock has been approved for listing on the Nasdaq (NDAQ). The company’s common stock will begin trading under the symbol WEST on Monday, February 25, 2008.
I have been expecting Western Sizzlin to announce the listing of its stock on the Nasdaq sometime this spring ever since I discussed my rationale for investing in Western Sizzlin. This announcement comes sooner than I expected. This is the special situation event I’ve been waiting for the Western Sizzlin position I own in Special Situations Real Money Portfolio.
I will be watching closely on Monday to see how Western Sizzlin stock reacts to its new trading market. My guess is that trading volume for WEST will be significantly greater than it has been for WSZL, which has been trading on the OTC Bulletin Board. This increased volume is likely to make it easier for institutional and private equity buyers to invest in this undervalued stock.
In addition to holding Western Sizzlin in the Special Situations Real Money Portfolio, I also have a position in my Fat Pitch Financials Port. The goal of the FPF Portfolio is different than that of the Special Situations Port. The Fat Pitch Financials Portfolio seeks to invest in wide moat companies trading at price levels that provide a significant margin of safety. Therefore, I will be holding on to my Western Sizzlin position in the FPF Port until WEST share price approaches $28.
There are also two other key developments to watch regarding Western Sizzlin. Western Sizzlin’s exchange offer for ITEX Corporation (ITEX) will be ending on February 28th. Just a week later, the Steak & Shake (SNS) annual meeting will be held, where Sardar Biglari and his colleague Philip L. Cooley will attempt to win two Board seats as part of Western Sizzlin’s plan to shake up Steak n Shake. This next couple of weeks will be a major turning point in the transformation of Western Sizzlin from a steakhouse into a potential mini Berkshire Hathaway.
Disclosure: I own shares of Western Sizzlin but hold no positions in the other stocks mentioned in this article.