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Capstone Turbine Corp. Message Board

  • cjclink3 cjclink3 Jun 17, 2013 2:08 PM Flag

    Question, Backlog

    I've been long for years, cost basis under $1, especially now that I got smart and took 25% off the table at $1.30 before the last earnings report. So, I have a question regarding backlog which always seems to be a Capstone centerpiece paramater during eachearnings reports as though it really means something to the markets. I understand that backlogged orders are certainly a measure of POTENTIAL, but only if the backlog is ever produced at a higher rate than the average. However, every earnings report, revenue is nearly the same +/- 3%, as well as earnings. So, who cares about the backlog, and why isn't it realized via real orders and production, especially with the production capacity of Capstone?.............thanks for a rationale reply, and please spare me the "do you understand finance" lecture, or the pom pom cheers. I've been patiently long for 5years, and the only finance parameter I care about is increasing share price.

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    • Capstone has said there is no advantage to building their microturbines, boxing them up, and sitting them on a shelf waiting for a purchaser. Maybe peculiar to the air bearing construction, the things hold up best when they are turning. Supposedly, stacked as an inventory waiting for sale and shipping increases likelihood of warranty work.

      And that the company presently ships many units at a loss, the companys cash would take an even greater hit for sake of an inventory of product which perform best in the long run, 'built when needed'.

      Many orders CPST ships go to new constructions, remodels, or facility upgrades and typically those engineered projects become ready for the turbine after many other trades (each with their own potential delays; waiting for material, weather, work done prior substandard or incomplete) complete their parts of the job. An order made goes into backlog with CPST receiving a tentative date for delivery. Such delivery dates may change and CPST prepares orders accordingly.

      When market familiarity with reliable turbine performance, expanded territories covered by better engaged distributors, and broader range of turbine applications begins to equal more turnover, maybe that growed backlog shipping will mean eps versus this multi-year margins carrot and stick.

      Just repeating what I have heard various CCs and understand from my construction trades days. What I repeat they say may be for 'a fools consumption'. Seems the CPST tech has promise. But dilution here gets repeated so there is cash on hand to ship product at a loss and pay salary and shares to a management with 'no skin in the game'. You may be familiar with other sub-$4 stocks 'keeping the doors open' like this for as many years.

    • Cpst backlog to sales current ratio is 1.05 at $148.9 million in backlog as of March 31 2013, and increased from $139 million year ago.

    • Backlog, including the product mix, are the two aligned metrics I like to see growing and changing...... and they are. The backlog growth is there, the margins are improving. Not yet ready to earn a profit last Q, but if next quarter results are not B/E or better, I'm done.

    • accounts payable? Backlog is a joke.What are they seeling to customers and how much money back.Are they giving things away for free?

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