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West Marine Inc. Message Board

  • deepharbor deepharbor Oct 18, 2006 10:07 AM Flag

    the top

    someone ring a bell, looks like the top, shorties safe to get back in the water

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    • Looking at the market, in general, and expecially at the VIX, I believe we are in the Pollyanna stage for some unexplainable reason. The fact this stock actually closed up after this report is nothing short of astounding.

      My only guess is that somehow computerized trading models have taken over that base decisions on factors unrelated to finance, i.e. charts, graphs, relative volume, direction of price, etc. This is a scary concept. Sort of like throwing voodoo bones on the ground.

      It will be interesting to see how this whole game plays out over the next several months.

      I guess I will go listen to the CC. It should be entertaining.

    • They weren't "very negatively impacted" from the hurricanes last year. Its just a lie excusing their poor results.

      The excerpt follows but I don't remember the NE or the West being hit by much in the way of hurricanes last year. What it does mean is that sales are still where they were 2 and 3 years ago and they have no idea why

      "Comparable store sales by region for the third quarter of 2005 were as follows: Northeast down (4.7%); Southeast up 4.6%; and Western down (2.4%). Port Supply (wholesale) division net sales through our distribution centers were $12.0 million for the third quarter of 2005, a decrease of $0.2 million, or (1.6%), compared to the same period last year, primarily due to marketing initiatives that prompted wholesale customers to make purchases at our store locations. Direct Sales division revenues for the third quarter of 2005 were $11.2 million, a decrease of $0.6 million, or (4.7%), compared to the third quarter last year, primarily due to cannibalization in areas where we have opened new stores and the impact of hurricanes, higher fuel costs and reduced consumer spending on recreational activities.

    • Personally, I am mystified that this stock is holding up at all. But, on the other hand, if there are really no buyers, who are you going to sell to?

      Did you listen to the CC? I haven't yet, but I can just imagine that it was the same old pep rally. When I get a chance, I'll take a listen.

      When they do decide to let go of this puppy, I can easily see it going to the low single digits like it did several years ago when it had better financials and prospects.

    • You must be looking at California real estate at cap rates that low!

      The time bomb at West Marine waiting to explode is the amount of inventory that they are carrying on their balance sheet as saleable which is actually obsolete and worthless.

      When they finally face up to this chargeoff, it will make any hope of earning money that year a fantasy and really shake the confidence of large holders of the stock.

      But, if Peter Harris and the new management team can continue to make excuses for the poor inventory turns, maybe they can keep this loss hidden until store closings makes the situation untenable, the CPAs wake up and force the issue, or the analysts finally home in on this issue.

      But, sooner or later they will have to recognize this loss. When they do, there will be a real rush for the exit.

    • I am not talking about this stock in particular, but the psychology of the entire stock market. We seem to have adopted this "Tulip Frenzy" attitude about equities where everything gets over valued by any historical standard of measurement.

      Right now, I am reviewing three appraisals on some duplexes. The appraiser didn't even bother to use the "income approach" I did the math and the values came in at 1/3 the appraised value at an 8% cap rate. I had to go down to 2.25% to get a value equal to the appraiser's figure. Yet, people were buying at 2.25% cap rates. Does that make sense? What are they thinking? You can get 5% on CD's and not worry. It is just a giant bet on a bigger fool.

      The fact is that P/E ratios and cap rates have been thrown out the window and once you do that you are begging for trouble.

    • not a republican conspiracy but likely manipulated to hold the level up here while waiting and hoping for a turn around. Remember last years numbers were very negatively impacted from the hurricanes.

      plenty of stock available to short at fidelity

      expect this will retest lows as we get into the depth of winter.

    • Gee did I call a top? Ring Ring, 14's today.

      • 1 Reply to deepharbor
      • Depends whether the funds are getting tired of waiting. As I expected, it was another miss under near perfect weather conditions in all markets.

        This is a single digit stock, trading in double digits. But, in this crazy market, it doesn't seem to matter: bad news is perceived as good news and good news is perceived as fantastic news.

        Look at the homebuilder stocks. The housing market is going into the tank, but the stocks rally.

        I think this has a lot to do with the elections. The monied interests abosolutely want to keep the Republicans in power solely for their tax policies and borrow and spend attitude that is driving this crazy debt financed economy of ours. It is like the hungry man eating his own foot.

    • When things look too good to be true, they usually end up being false. People who play both ends against the middle end up getting squashed once the facts come out. I think that will happen here.

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