Does anyone out there think that CONN will not make their projected EPS of 2 cents a share ? If they do, we are off to the races with 80 % of the float being short. With a book value of 10 to 15 (depending on the website) and the share price at about 4.50 , this is a perfect storm in favor of the "longs". I have never seen anything like this. This is nuts. This is "short squeeze heaven".
Also food for thought for next quarter : If you look at the dollar difference between the current ratio and the quick ratio, that adds up to about 35 million in inventory. A good portion (probably half) of that is electronics out of Japan. Since Japan will not be producing electronics to anywhere near the capacity they have in the past, CONN's inventory just became much more valuable and over the next quarter will sell everything they have that was made in Japan at a good price. Sales will definately be up compared to a year ago. A tremendous boost and saving grace for CONN's, just when they need it. They probably have a bigger inventory compared to their competitors of Japanese products since sales have been slower, (dollar for dollar compared to market cap.) Anyway I think it is time to buy and hold (long) for about at least the next two earnings reports. (next 100 days) I have 10,035 shares and am thinking of buying more.
Is my logic flawed or am I missing something.? Give me both barrels if you think my analysis is way too simple, I can take it. I admit I have no where near the knowledge and understanding of the business end of things compared to some of the guru's out there that know how to crunch the numbers and know a lot more than I do.
richard, unfortunately I do have a lot of my eggs in one basket (about 2/3 of them.) I think I have already decided to keep CONN for at least one more quarter regardless of what happens. I have never been in a Conn's either but a "rent to own" is simply an additional option. More options for shoppers are always better than less options. If renting to own a washer and dryer will make a young couples life much easier , and it is the only way, then why not.
Can I ask why you have 2/3 of your money in a single small-cap stock? Don't get me wrong, I think CONN is a good long-term investment, but it's more like 4% of my portfolio, not 66%. You're taking a huge amount of risk. Why not diversify some more? Especially since, as I recall from a previous post you wrote, you're nearing retirement age. You're really rolling the dice with your financial future, I hope you realize that.
I concur. There is going to be a big short squeeze. I'm concerned with the number of shares you say you have. I hope you don't have all your eggs in one basket!---Outside the box thought-what do folks think of CONN becoming a "Rent to Own" store? [I have never been in a conn's]