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Crexendo, AŞ Common Stock Message Board

  • cissyleslie cissyleslie Feb 26, 2005 6:08 PM Flag

    EXE quality of earnings

    Well let's talk about EXE. Profit taking is one good reason why the stock price dropped after the earnings release. I could see folks not liking the earnings.

    On the one hand the company's news release on their website bullets "� Q4 health care earnings of $0.29 per diluted share; net earnings of $0.84 per diluted share"

    But if you look at the details the following information is presented.

    Health care operations .29 vs .21
    Valuation adjustment (.01) vs
    Gain (loss)from asset
    disposals, impairment
    and other items (.08) vs
    Prior year tax benefit .56 vs
    Subtotal .76 vs .21

    Share of equity
    accounted earnings .08 vs .03
    Total .84 vs .24

    If you take out the "prior year tax benefit", and the "share of equity accounted earnings" the earnings are pretty much flat. In fact the company says as much in discussing the quarter. "Revenue declined by $5.6 million to $426.0 million during the 2004 fourth quarter in comparison to the 2003 fourth quarter. However, prior to the negative impact of the stronger Canadian dollar, revenue grew 4.2%."

    The company is taking some good actions: buying assited living beds with higher margins, the dividend, and buying stock back. However, the earnings are not that stupendous. Part of the problem is where the earnings growth comes from. There is only so much increased nursing home reimbursement the states will provide and more 6.8% increases aer not in the works and Medicare occupancy cannot be increased each year by 6.4%.

    Folks could have looked at these earnings
    and decided to sell.

    We could talk about other stocks too. It's possible to get irritated if we talk about other stocks, but pmoll did me a favor by talking about NOK. After he talked about it, I bought on 1/31/05 at 15.2 and sold on 2/16/05 at 5.77.

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    • I feel exactly the same way about the earnings and conference call. I also got the impression that the cost of labour was up and that the new acquisition had to be absorbed before any more growth would occur..... All still solid and well managed though.
      It will take a full 4 qtrs to see a clear picture with the addition of Assisted Living.
      I bought more NOK at $14 up through $14.7 last month, still haven't sold any. I should have shorted MOT and I knew it.

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