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Cache Inc. Message Board

  • jtmaimi jtmaimi Dec 14, 2009 9:50 PM Flag

    Sell company or Replace management!

    Dressbarn, Anne taylor, Chico's all doing well now. The stocks are way up. I think this company should put itself up for sale or get someone in there that knows what they are doing.

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    • Three years later and 20 million in losses the big boys finally decide to do something. If they had listened early they could have saved 20 million. Andrew Saul is an arrogant incompetent. Micheal Price saved this company from bankruptcy.

    • ya, i

    • please this management needs to be replaced

    • chicos, dressbarn, and ann doing well. These stocks are hitting new highs. Cache management are morons and the stock is closes to it's lows, the management needs to be replaced or the company needs to be sold.

    • The same morons are in charge and all they have done is lose money and get sewed for stealing trade secrets. It's been a nightmare for everyone involved. It's like there are no adult business people involved in this company. Cache should not be a public company because they are not worthy.It is a sad sad state of american business.

    • After seeing the results and listening to their conference call it's easy to see why wall street shows little respect to this company. It would be better if they changed top management or sold the company.

    • jtmaimi:

      Thanks those kind of words.

      At this point, all my holdings are in usa based.

      I think there is still some areas where i see value. Like Furniture retail/manufacturing business. Of course business is still difficult, but i think when housing is starting to recovery (couple next years), we would see some up tick in furniture sales too.

      And what comes to Caché, Lets comment again when new information arise.

    • Rammmi,

      Thanks for the information. I appreciate it. I agree with just about everything you said. We seem to think alike. I guess this is why we both own the company. Thanks for your upbeat comments. I think something good will happen to this company eventually. It seems that the big boys have the opportunity to make the right decisions to reward shareholders. I guess we will just have to wait.

      Are there any other companies you like here in America?

    • Message part 3/3: (stock market performance and management team)

      “jtmaimi: I agree with you about chasing competitors that are doing well now. It is too late now that there stock prices are up 4 to 5 fold since the March lows. I guess some deserved this kind of appreciation and others do not. I’m just surprised that Cache was not rewarded much for the prudent steps they have taken.”

      I feel exactly same way; this kind of underperformance has been huge disappointment for me. If we look 2, 3, 5 year track record, Caché is worst in class. Of course soap is ready when you see that company’s management is ready to modify their performance metrics (to gift more compensation). They have forgotten most important reasons why people own marketable securities. Marketability must presuppose not only a place where they can be sold but also an opportunity to sell them at a FAIR price. This is reasonable requirement and they have failed to deliver it.

      If we look performance under current CEO (since Jan. 08), we are still -55% underwater. I think he cannot (shouldn’t) be satisfied either this kind of performance.

      “jtmaimi: I bought 25k shares last year for an average price of around $2. I’m holding them for a while to see what happens. I think this company could be bought out by another company for much higher prices. It would make sense economically. It is a very good candidate in my opinion.”

      I agree, company would be good takeover target for bigger company or acquired by private equity guys. They would easily pay many times more than today’s $ 30m enterprise value. If that’s the case, like I believe, it means management hasn’t done their job too well. This depressed market price indicated that company is worth more without current management. Your written subject “Sell company or Replace management!” is rational proposition.

      I have considered why we haven’t heard any activity in takeover or buying side. Two reasons comes my mind. Poison pill which they have in place and other is major owner/founder who may be unwilling to sale; maybe we have still too concentrated ownership structure. Without these I think this would be already acquired, if we keep in mind how this has traded enough long time about prices what they have cash on books.

      All that said, I still think if management is really starting to take actions to create value for shareholders, they would be able to extract lot more value from stock market than private markets where deals are today generally closed somewhat moderate prices.

      The reasons I believe stock market would be still be better place owners of Caché, even we have traded cash prices already way too long time.

      * Relatively illiquid stock
      * Growing sales trend (after shrinking enough)
      * Lots of “rocket fuel” on books

      These can be “sick” combination, like history has proven. ;)

      ps: Lets keep writing occasionally, when new information or something comes to mind. Thanks!

    • Message part 2/3: (economy and sales levels in future)

      “jtmaimi: This unfortunately is very possible. The economy before was based on false profits provided by a housing bubble and home equity loans. Americans used their houses as ATM machines. That is history and now banks are cutting peoples credit. There is no more free money here in America. People are not in the same position they were in over the last decade. I don’t see what will bring a recover in the future.”

      As foreigner (from Scandinavia) it’s easier to be more optimistic about future of people in USA, even unemployment is high and retail environment still soft I don’t have to face all that misery, but it’s not much different here where I live, unemployment is creeping +10%, of course competition may be some what easier here for local companies, because here is not so much oversupply of retailers (yet).

      What comes to Americans housing ATMs and sales levels in bubble years, I am not so worried about that, even top line has taken hefty haircut +20%.

      Who knows what they (management) really think, but when you look that “suspended” share purchase plan (2009), I would say their main concern is not top line, they may feel enough confident to be able to drive top line growth again in future. Otherwise, it would be prudent and natural step to purchase 50% back of our commons stock at discounted prices and do business much more per share basis, even reduced top line.

      Still I think best way to create value for shareholders would be aggressive share repurchases at least some kind of blended strategy, where they really begin utilize that cash pile as going forward. One main reason why whole retail industry is not doing too well, is because, companies are not willing to return capital for owners (divs/shr-bb). Everyone is just focused on growth and store expansion and that kind of over expansion is just shrinking everyone’s margins.

      Of course in smaller retailers like Caché it would be legitimate be little bigger, especially today as vertically integrated retailer, it could more important than ever to get higher sales volumes to drive margins upward. But there is plenty of cash in books to utilize in both opportunities.

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