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CryoLife Inc. Message Board

  • dlhild@ymail.com dlhild Aug 13, 2012 1:09 PM Flag

    Amendment of FY 2012 Bonus Agreements:

    http://biz.yahoo.com/e/120726/cry8-k.html

    Comments regarding the above link:

    Some capping of bonuses would seem on the surface to be a good thing. Was this the influence of new Director Jon Salverson I wonder?

    Comment #1: Looking at CRY’s long term stock chart, one has to wonder how effective the historical bonus program has been in the past.

    http://www.google.com/finance?q=cry

    In the above chart, where it says ‘zoom’, click on ‘all’ so that you see the CRY chart from 1993 to the present.

    The point here is that based upon historical stock price data, one has to seriously wonder about the competence and effectiveness of CRY’s current management generally.

    Comment #2: If CRY uses the current stock price as an important metric in granting future bonuses, they are setting the bar too low. Like really, is claiming that any stock price improvement from the $4-$6 range is some major accomplishment. In reality, it seems that SA’s decisions have hammered the stock price. Why? See above link. Roughly $0.06 in earnings improvement should occur from lower litigation expense alone. This is hardly a laudable accomplishment deserving of a bonus. Had SA stayed out of the litigation situation entirely, my guess would put current year EPS in the $0.45 to $0.50 range (this is a guess, but roughly in line with my recollection of analyst estimates from a couple years ago).

    The point here is that the stock price reasonably should have been in the $8 plus range had SA just not made some bad decisions. CRY still lacks earning visibility, so there is still a lot of uncertainty going forward. Volume has evaporated. It is still possible that some of SA’s earlier decisions may work out in the long term. However, there is no current certainty that they will. Based upon the stock chart, I would rather have a new CEO on board and then gamble on him/her.

    This is just my opinion. I’m not representing anything as factual. You’re responsible for your own due diligence.

 
CRY
10.02-0.08(-0.79%)Nov 25 4:02 PMEST

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