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J. Alexander's Corp. Message Board

  • smaycs3 smaycs3 Oct 6, 2011 5:50 PM Flag

    A bit surprised that JAX has held up as well as it has


    With the way the market has been, I wouldnt have been surprised if JAX fell to $4.

    Wonder if this means there is an accumulator ?

    Would Lonnie finally agree to put this thing on the block ?

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    • JAX has held up well and appears to be very undervalued by the market (considering their owned RE and sales), but their earnings are very disappointing. I am concerned that they have not been able to reduce their operating expenses (or obtain better leverage from improving sales). With only a single digit profit margin before G&A, it is very hard for them to earn a reasonable profit and then when you consider their significant capital investment in each location it gets worse.

      Any chance that JAX can convert a failed restaurant into a profitable J Alexander’s location and therefore not spend as much capital on opening each location? How about them buying/merging with another small operator?

      Regarding being sold – if the company ever received a serious offer would not the Board have to consider the offer, therefore Mr. Stout can not prevent the company from being sold. What happens when Mr. Stout retires?

      Finally I remain a little surprised that E. Townes Duncan remains on the Board even though he has sold a lot of stock over the past few years.