Having held this stock and averaged down for almost two years im trying to find reasons to either add, hold ,sell, or waive or ex our upcoming rights at this point. My interest in COSI was based on my visits in which the food was excelent. I made a initial speculative buy after reviewing at their past results.
The location i would visit near work closed several months ago. It was busy at times but without any consistancy on a regular basis. It seems to me the food is great but there is something going wrong in marketing, location selection, store layout, service ? Im not really sure what the issues are but the food is good. I dont think alot of people know who they are. Everytime i have brought someone with me they enjoyed the food and most returned on occasion. Im not sure whats wrong here ?
The fact they have little or no long term debt keeps me as a current shareholder. Cosi has at least done a good job so far keeping itself debt free. The rights offering is interesting but im wondering now how quickly these rights will expire ? Im not sure this is any sort of a long term answer. The fact remains Cosi needs needs to generate cash.
Without sounding off with explicitives perhaps some of us could point out some pros and cons regarding this company and its efforts. The product is good so why isnt it selling better ?
COSI could easily end up getting merged into a bigger family - things like ZOUPs, Einstein bagels, you could see some large player swoop in and grab them to make distribution more realistic
we still haven't seen a lot of buyouts/mergers during this down economy - once things pick up the big boys would want to use their cash to pick a few risers on the cheap
hopefully COSI is part of all that to get us form .50 to 5 in 2-3 years
The company is debt free, sure. In business it is easy to be debt free; that usually means that no one is willing to lend you money. This company has been grossly mis-managed for the last two years, and until the present "leadership" is removed or replaced, the stock will continue to be worthless.
The bottom line is COSI needs to start making money. If that happens then the share price will certinly rise.
Cosi is pretty much debt free so to speak which is a real good thing.
The rights offering is being used to raise additional cash.
I have enough shares of Cosi but will exercise provided the current price isnt near .50 or below
One would assume some people may sell their optioned shares for a quick profit.
No matter what the case is, what is COSI doing about increasing traffic and driving sales ? Thats what im most interested in so maybe my .50 shares are worth 5 or more in a year or 2.
The food is good. The concept is good. The market is unlimited. How they gain market share at this point remains to be seen.
Here is a good article on rights offering ..
Keep in mind COSI stated you cant sell your options itself and will be offered to another existing shareholder
Im going to guess no... Cosi stated they are trying to raise 5 mil in cash.. They anounced the option price will be .50 So this would indicate to me they will offer 10 mil shares divided by existing shareholders. Since there are only 40 mil shares out now figure on 1 option for 4 shares. This is specultive however because the details have not been released. Insiders have also who have agreed to purchase as well. Time will tell..
dj - I agree with you on this company's menu offerings as the food is liked by many people in Washington DC and their restaurants are full most lunchtimes. As the famous investor Peter Lynch has often used as a guide to a good restaurant investment, this speaks volumes.
What you don't seem to understand is the rights offering. Once this is behind us, I believe it is off to the races barring a double dip recession. The offering is what has been holding to stock down but none-the-less, it is a great deal for the present shareholders and represents managements fairness toward existing shareholders. Those that are smart should participate by exercising their rights, purchasing their pro-rata portion and thereby preventing dilution.
Management with ethics like this I want to know. Most would run off to some hedge-fund and do a quick deal and hurt the existing shareholders (John Cooper of DSCO comes to mind). This management should be commended and I will pony up my share. You should to as your rights will expire within a short period.