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Edac Technologies Corp. Message Board

  • boby_varghese1 boby_varghese1 Mar 21, 2013 3:53 PM Flag

    CVU

    look at the volume. Yesterday as well as today, CVU has 5 or 6 times the avg volume. For about $8.5, this stock must be a great buy.

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    • This stock hasn't done much for the past few years, what's your thesis and what might the catalyst be?
      Thanks for sharing.

      • 1 Reply to seeking_profit
      • There doesn't really need to be a catalyst. The stock has sold off from $11.50 to $8.55 in a couple of months and was way oversold. If my read on the charts is correct, it's about to go up $1 a share within the next couple of days, if not tomorrow. Volume has been increasing at the same time. It may only go up for a few days; I'm not suggesting it's a great company to own but for a short-term trade, it looks pretty good right now.

    • Now I hate the company. BUT, the short term chart shows CVU will make a big move in 1 to 2 days You may be onto something...for a short term trade. I also love love DRYS for a short-term gain and looks like it'll happen immediately.

      • 1 Reply to argyle46
      • I traded CVU actively in the early/mid 2000s. I drank the kool-aide there too, for a couple years. Mr. Fred is an impressive sounding CEO, initially. But, you'll soon catch on. He's a promoter. All hat, no cattle. He promises the moon in the way of new business, but fails to deliver.

        The more significant problem there is their accounting. They use % completion accounting, which is highly subjective. Mr. Fred is a former CPA, he knows how to massage the numbers so that profits show continual growth. It can be done for a number of years, but eventually it catches up with you and massive write-offs ensue. Their last major write-off was a year or two ago. They'll have another within the next 1 to 2 years. You simply can't trust GAAP accounting there. Book income is meaningless in these cases. The only gauge you can use in judging CVU's performance is FCF (free cash flow).

        Look at the cash flow stmt of CVU. They book profits, but never generate cash. In the last 3 years alone, they have USED $38 Million in cash from operations. The company has a mkt cap of only $71 M. Last time I saw such a massive imbalance ... Enron.

        CVU is simply dangerous. Their CEO has no credibility. Their financials can not be trusted. You'd be smart to stay away from CVU.