In any event, SYX still appears in our Advanced Graham Number Screen. While not strictly a Ben Graham creation (the Advanced Graham Number Screen was in fact invented by The Graham Investor to apply Graham's technique to stocks that have large insider holdings), this Screen has produced some interesting recovery-play candidates, of which SYX seems to be yet another.

Fourth-quarter sales leaped 26% to $550.8 million, from $437.5 million in the same quarter a year ago. Sales of e-commerce products increased 45% year-over-year to $156.4 million, representing about 28% of total sales in the period.

For the year ended Dec. 31 2004, Systemax's net income almost quadrupled, rising to $12.6 million, or 35 cents per share, from $3.4 million, or 10 cents per share in the previous year. 2004 results included pretax restructuring and other charges of $7.4 million. Excluding these charges, net income for the year would have been $17.6 million, or 50 cents per share.

Having restructured their business model in North America and shown a dramatic return to profitability as a result, SYX management now intend to map that strategy into their UK and European operations in an effort to get the same result.  Combined with the success of TigerDirect, this looks like it will possibly add more to the bottom line in subsequent quarters.

Looking at the chart, watch for a break above the 52 week high of $7.70 set in January, along with substantial buying volume, to perhaps confirm a new uptrend. On the downside, watch for gap closure before any continuation upwards.