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Compass Diversified Holdings Message Board

  • dividendguy dividendguy May 10, 2014 6:10 PM Flag

    Cash Flow

    Operating income seemed okay compared to last year and EPS came in above estimates so the only thing I can see is cash flow -- (6000) vs 20000 last year. Seems like a large increase in inventory. Is anyone else seeing the same thing. I don't have many shares but am looking to increase if risk is negligible. Can anyone explain the beating this stock is taking after the earnings release. Also, looking at the increase in accounts payable last year it was 17,000 and this year (22). That's a huge difference and explains the difference between (6000) vs 20000. So, is this a one time phenomenon or an ongoing problem? Comments.

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    • I have not dug into this yet but at first blush.......The two things I see are that FOX was spun off and no longer counts in the cash flow numbers. The only ding looks like a US military contract for camelback (low margin - high volume) that was completed last year. This reduced sales but not earnings. Now I realize they "missed earnings" but they actually only missed what the analysts projected and not what management projected. Given that they seem to be under control, I'm okay with a company that is "stagnant" at an 8.5% dividend yield. Especially when that same company has cash, borrowing capacity and no significant debt repayment requirements until 2017. But like I said, this is only a cursory look

      Sentiment: Hold

      • 2 Replies to boardwanderer
      • As we have stated in our previous call FOX is no longer included in our calculation of our cash flow following the successful completion of the company’s August 2013 IPO, in which CODI generated debt and equity proceeds totaling approximately $142.4 million. FOX’s results however will continue to be consolidated with the results of our other subsidiaries until our ownership percentage drops below controlling interest.

        From :

        Compass Diversified's (CODI) CEO Alan Offenberg on Q1 2014 Results - Earnings Call Transcript

        Sentiment: Strong Sell

      • You can get a high yield for a high risk. If the price of the stock drops (which is likely) then
        your return on investment will be well below 8.5%.

        Sentiment: Strong Sell

    • Ah someone who actually wants to do research...I love it.

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