They need to triple sales just to break even. Now losing $2.40/ year. If they get low on money the lender can call for default and take the company. They are burning $70 million/year. Therefore they have 12 months to triple sales or goodby. Of course they can issue stick it $2-3/shr.
$.64 dividend when they are earning $4.50. MGT thinks of itself first buying back 8% of the stock. Trying to get their options to exercise. We want a $2.00 dividend now. Perhaps we should vote in some directors that will think of shareholders first. They could actually pay a $4 dividend as the need for added capital is minimal and there is no inflation so little need for more working capital.
They have way to much debt. Relative to other REITS, they are 40% over leveraged. That much debt places the company at risk in a stress situation. Buying back more stock only makes the problem worse.
They should spend all their time restructuring debt to at least 10 year maturities. These low rates will not last forever. Day trading assets is not a good strategy. The have done a few things I suggested--stopped the drip, cut the dividend, and got out of central control but at a high price. The really need new management.
When a company is considering going private, they are precluded from trading in their stock. GPS is a sitting duck for private equity-- good cash flow, little debt, excellent franchise.
Declare a dividend of a meaningful amount. The short interest will be required to pay the dividend to the account from which the stock was borrowed. The carrying cost of the short is then the cost of borrowing and the dividend. It would rise dramatically.
All rehashed news from 2 years ago. Just as we thought, they build up a big short position and then publish old news. It works again.
I have done it before. Sell short lots of stock on a price rise and then dump 100,000 share lots when there is slow trading. Cover on the panic. Should be illegal but not enforceable. That os what is happening today.
It is on its way to bankruptcy. Costco had 12 packs of Reed;'s for $10. The margins on that do not cover costs. The are desperately dumping inventory.
The offering is highly dilutive. It was a condition for PMC to extend the loan and add interest to principal. REEDS is in death throes.
Ruane, Cunniff & Goldfarb really got smacked--Sequoia Fund SEQUX. The history of the Sequoia Fund traces its roots to the late Bill Ruane's lifelong friendship with Warren Buffett. I guess he forgot what Warren told him. They are 14% behind the SPX this year and 27% behind for the last 2 years, 35% behind for the last 5 years and 48% behind for the last 10 years. WOW. . SQ's Lew Simpson also forget about Warren. He is down about 13% this year. Viva la Indexing!
It is not Pershing Square, Paulson, Jackson Square or Goldman. SQ Advisors rode it all the way down and then sold 1/3 of their holdings. The Money managers are like odd lot investors chasing the crowd. Good to see the highly "professional" are the worst.
CMOH is really cheap. They will also raise Div next report. Selling at 8.7x (ex LI proceeds) and 1x BV where other regionals are at 1.6x BV. Now in small cap stock index. Buying back their stock. Earnings growth is organic and not from Loan loss changes. Sitting duck for takeover.
Sentiment: Strong Buy
Selling at BV in an environment where regionals are selling at 1.6x BV. earnings ramping up and running at $3.16 annual rate. Stock is 9.3x earnings. Dividend will be raised on next declaration. Stock yields over 4% on that $.30 dividend. Loan portfolio in good shape, Very cheap bank. CMOH is actually even cheaper. They will also raise Div next report. Selling at 8.7x (ex LI proceeds)and 1x BV.
Sentiment: Strong Buy
Working capital deficit is $46MM, LT debt is $46MM, lease incentives and other liabilities is $81 million. Market cap is therefore $284 million. That makes the company 8x EBITDA. It is too leveraged with little capability to borrow. With Same store sales dropping 3-4%/year, it is recipe for disaster. They bought back stock at $14 in 2015 and now it is $8 and they are buying more. It is not a good buy until they fix the BS. The have negative free cash flow. Who is managing this mess? There food model is completely out of line with modern cuisine of light and healthy. no Bravo.