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Famous Dave's of America Inc. Message Board

  • bjorn234 bjorn234 Mar 4, 2010 4:38 PM Flag

    volume today

    157,874 shares means that somebody was accumulating a lot of shares today. That is more than 6 times the normal volume and the most shares of DAVE trading hands in nearly 6 months. Of course, the price didn't budge, but I think this is an overall positive reaction by Mr. Market to a pretty neutral/expected earnings report.

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    • You were right. According to SEC filings some of the volume can be attributed to managers exercising options, selling some to pay for the bulk. Good call, your move to 8's came today.

    • We've talked about this again and again - the accumulation in the low to mid $7 range. Now the stock has exploded to the upside on huge volume thus far today. I think it's safe to say that there are no more shares between $7-$7.50, we'll see DAVE breach $8 soon.

    • yourbestfriendintheworld yourbestfriendintheworld Mar 12, 2010 1:03 PM Flag

      Yesterday was someone with a much lower basis taking profits after several months of slow growth.

      Institutional? At these volumes I doubt institutions are doing any trading in DAVE.

      DAVE needs two things to be a big deal again: first, an economy that supports expansion, which FD's has plenty of room and muscle to do; and second, the prying eyes of M&A bankers fronting for a restaurant conglomerate.

      And if the conglomerate is smart, it will make its move before the economy makes DAVE grow.

    • Agreed. More importantly, the stock well towards $6.80 immediately and from there was basically accumulated on heavy volume (for DAVE) all day ...

      Bottom line - this stock is trading at an EV/EBITDA multiple of about 5 - which is ridiculously cheap for the sector. Just that alone leaves a PE buyout premium of about 30%.

      On a FCF basis, with only $5 million of CapEx for 2010, and CFO should come in at over $15 million, that puts FCF for 2010 over $10m. Put a conservative P/FCF multiple of 10 on that and the stock should be trading with a market cap of $100m - which is approximately 50% upside from here.

      Therefore, I agree with Feitl - and have read the report, that this stock should be trading at around $9-$10 ($10 is my target, looking at the difference between the two approaches above, $9 is Feitl).

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