this is an asset investment.....free cash flow burn (they have practically no infrastructure) will be minimal going forward....how many employees do they have, 50???......I saw on QVC that cubic z is going for $15-$20/carat on clearance (roughly calculated)....let's be conservative and say that the long-term inventory is worth only 1/3rd of book value today, which is about $15/carat.....that implies that the stock is worth about $1.10 per share today (i take out just under $2mm to get rid of everyone at the firm).
now let's look forward to five or six years from now.....based on what the market is telling you, gold and silver are going higher, and we most likely are in for above average inflation once S&P earnings recover late next year (the market is telling you there is an 80% chance....this could change, but for now that is what the market is telling you). Under this scenario, it is not unlikely that the carats will go for $70 to $100 eventually.....this would make CTHR a $4 to $5 stock in five or six years and you would make 10x your money from today.
the only thing in the way of the aforementioned is if the jewels in inventory are flawed in some manner, and cannot be sold due to defects......outside of this, you would want to wait on this investment.....management seems indeed to be morons, but assets are assets