On Feb. 4th., BBSI's investor page posted the following guidance for its 1Q 2014, ending on March 31, 2014.
Projected gross revenue: $735M to $755M (Low, high)
Projected diluted loss per common share: $(0.45) to $(0.50)
* My comments: Payroll taxes are paid in the first quarter, so a loss is not unexpected. For comparison, 1Q 2013, BBSI reported gross revenue of $591M, and EPS of ($0.36) Management has to have included the impact of the ACE insurance policy into this guidance. So the current bloodbath on the stock seems unreasonable. .
I agree that the current erosion of price has been overdone but why with revenue that much higher would the coming loss be greater on a per share basis? Is it because of the worker's comp issues, or because of the insurance premium?
It's worker comp payouts in California. They are changing up the business and will know the affects come first quarter 2015. Also, going forward, revenue growth was below consensus. I shorted 1,000 shares (as you can see from future post) but am considering covering if it holds $60. If not I see further downside.
Good luck to all investors. Hope we all do well for the year, seriously.