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SunOpta Inc. Message Board

  • red_wombat80 red_wombat80 Nov 21, 2008 11:00 AM Flag

    Am I missing something?

    I must be. I know that SunOpta has made a habit of missing their numbers, but let's say that they're off a couple of cents from the low end of their $0.19 - $0.23 guidance and come in at $0.17. That's still a PE of around 8 given the current price of about $1.40. This is on company that, while it's had it's share of control problems of late, is still growing ... around 41% last quarter to quarter.

    I'm thinking, perhaps incorrectly, that earnings will benefit from the lower fuel costs we are now seeing. Am I off base here? Maybe it won't help the bioprocess side, but that's really an insignificant part of the business at current course and speed and just represents an upside opportunity.

    I don't really know what to make of Bromley staying. I'm inclined to accept that as a sign that the board is comfortable that things are on track.

    I bought a few more shares yesterday... and may continue to nibble as funds become available. Of course there are all sorts of other stocks that are also now at ridiculously attractive prices.

    Any thoughts on what I'm missing other than thoughts that there is more behind the change in auditors than what has been publicly stated?

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    • They have lost all respect on wall street. Thats all u need to know.

    • IMO, they missed their numbers and gave weak guidance and that was enough to convince funds to sell. I don't believe there is another shoe to drop that anyone is aware of including funds. Steady selling as funds unload vs weak buying is going to keep the shares falling until it dries up.

      I have gone through the CC transcript (available on the website) as well as the 10Q and i'm waiting for some info from the Company. I will post some notes later.

      I agree that the fuel and energy savings should be very postive for companies as well as enabling consumers to buy more food.

    • red_wombat, you're not missing anything. Insiders are even buying here. However, the overall market is in a downtrend. These are unprecedented times folowed by huge losses in the market. I expect it will stay that way for some time. However, this is good time to buy stocks, including STKL.

      • 1 Reply to biggestbison
      • red_wombat, I'll just buy it all the way to the bottom and all the way way back up. Instead of buying a $300 million revenue company for $7.40, you can buy $1 billion+ for $1.50. A minimum sale value alone for a company growing 20% a year and this size is $15 based on 2009 revenues. I don't think they will sell but that's what we are worth.

    • Red,
      P/E alone doesn't make it. Take a look at the level of debt the company has taken on.
      The banking covenants are a big concern here and I think account for a good chunk of the decline in share price. The company has had covenants loosened on a temporary basis and so is now in compliance. The concern is whether or not the company can meet the stricter covenants that are coming next year.
      Remember with the share price in the tank, it is not a simple matter of raising more cash through an equity offering as was done in the past.

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