I've done the work here and have found that this new management team has completely turned this company around. It was doing high single digits EBITDA until they came in and this year they'll do $15m of EBITDA. They're shutting down unprofitable divisions, signing new customers...What's the deal? Why all the hating on this management team? Please cite specifics rather than just calling them names...Much appreciated.
Int...yes, on the surface this appears to be a turn-around story that has some real prospects to grow, reduce debt, and increase efficiency. My most recent issue is the downgrade. Clearly, these guys saw something they didn't like...and that said a lot to me when considering years of Caldwells rule and the run-up in pps just before his departure.
Thanks for all the replies...apparently getting any unique insight from this particular board is completely off the table. I asked for specific reasons to mis-trust this management team rather than name calling and I got:
"They don't know what they're doing" - Way to be specific!
"Twanks" - I live in the US so I don't know what this means but it certainly sounds pretty stupid
"Analysts and investors have soured on EBITDA" - And you'd rather use GAAP EPS? Good luck with your unfudgeable number...Twank
Oh, and one more thing. Ebitda Is not the best measure, and typical of these scammers.
But at the end of the day, many analysts and investors have soured on EBITDA simply because the numbers are so easy to fudge [source: Smith]. Unfortunately, EBITDA has been used by too many dangerously leveraged companies -- including those infamous dotcom flameouts -- to skirt GAAP standards and fool unsuspecting investors, earning it a bad reputation on Wall Street.
This company is not dangerously levered. They have 1.2x bank debt / EBITDA. And EBITDA would be a good number to use in this case for two reasons: 1) They can de-lever in ~2 years at full capex, earn-out, and restructuring rates so looking at an unlevered number to get a sense for the earnings power of the business is important; 2) Cash taxes are limited given the $80m NOL.
Six cents a share earnings on record revenue. They don't know what they are doing. When revenue dips, they will lose it all. But go ahead, you did your homework, now lose your money like every other joker who buys this management team twanks....even management won't buy the stock. Why would you?