I was an investor in Avid and the former CEO David Krall some years ago, I just had a look at Avid again. I can't say I'm impressed. Extracted from yesterdays prelim Q12012 results
"The company currently expects revenues for the three-month period ended March 31, 2012 to be approximately $152 million. First quarter revenues //down approximately 30 percent compared to the first quarter of 2011.
The GAAP operating loss for the first quarter of 2012 is currently expected to be approximately $15 million."
I still remember Gary Greenfield's 'get Avid fit' message back in Dec 08 with the stock at $28. ( When I sold out ) Four years on this is a sick company by any stretch of the imagination. Another thumping loss and an unsustainable reduction in revenues.
I don't think the managemnt team have a handle on the business at all, the guidance and results are invariably poor. I think even at these prices it's a risky volatile investment.
However what strikes me is that David Krall always had a clear insight, vision and direction for the business, he was a great communicator -and it's that quality customers and investors bought into. I was happy to invest in Mr Krall. As for Mr Greenfield, well I'll just wait another 6 months for the next CEO to land.
Just as shocking as Avid's stock plummet is their company reviews on Glassdoor. Many are very unhappy with the direction of the company but as they say,..the beat goes on.
Sentiment: Strong Sell
Consolidation within the media industry is most likely for the next few years. Speculation this week is that one of Avis's competitors, Chyron, is looking to be acquired. Possibly the value in Avid lies in being acquired.
ha ha - what Avid needs is a few more managers! Seriously, that way they can work the few remaining "workers" to produce miracles.
Nothing will change while Greenfield remains in control. He has entrenched himself in with dictatorial type contract so no one can get rid of him, or at least it would be very expensive. His task was to break up Avid and sell it off; in that he failed dismally.
I wish I had the foresight to sell at $28 but then my game is not in the stock market. ho hum
Unsurprising to see Ken Sexton the former CFO has been shown the door by the incoming CEO Louis Fernandez. A wise move and indicator for me at least that there is more bad news on the horizon regarding accounting at Avid. Louis Fernandez has one shot at cleaning Avid up at the start of his tenure. I expect that when the 2012 results are finally reported they will be bad, and previous years accounts will have to be restated, - not for the better. I cannot reconcile how $250M of goodwill sits on the 2011 Avid balance sheet relating to products and business units Avid has either closed, divested or terminated, in 2011 this represented 40% of Avid's assets. I think Avid has a real credibility problem at the moment and I think the stock has yet to hit new lows and is uninvestable this side of the 2012 results.
Sentiment: Strong Sell