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AFCE Message Board

principletrade 142 posts  |  Last Activity: May 25, 2016 3:39 PM Member since: Aug 10, 2012
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  • Reply to

    WT

    by dontfollowtrends May 25, 2016 12:29 PM
    principletrade principletrade May 25, 2016 3:39 PM Flag

    Yeah, really you make a bigger percentage going long. Example: if a stock trades in a $10-$15 trading range you make 50% going long at 10, but you only make 33% going short at 15. You're going to make way more money going long on a range-bound stock.

    Beyond that, the worst you can lose going long is 100%. Your losses on a short could be theoretically limitless.

  • Reply to

    CC

    by shorting_amazon May 23, 2016 12:55 PM
    principletrade principletrade May 23, 2016 4:22 PM Flag

    I'd like to go on to say that I think most shareholders would prefer VOXX to simply stick to their proven business segments and try to actually earn a profit.

    It's one excuse after another with their ill-advised schemes and shareholders have simply been screwed as this continues in a virtual free-fall quarter after quarter.

    There's almost certainly some value locked up somewhere in a company with a market cap that's less than 1/10th of revenues.

  • Reply to

    CC

    by shorting_amazon May 23, 2016 12:55 PM
    principletrade principletrade May 23, 2016 3:02 PM Flag

    Yeah, the management is basically flailing around reckless ideas and shareholders don't really have a voice. That's how you earn a $2 sp.

    That's really pathetic. The current enterprise value has got to be even lower than what Klipsh and several other of their brands are worth EACH. There are probably high school kids that would run this better. lol

  • principletrade principletrade May 23, 2016 2:58 PM Flag

    Yeah, they may not post a profit in Q2, they probably won't due to extraordinary expenses. All I'm saying is that there could be a silver lining from an accounting standpoint if the share price is low when the shares are issued.

    Sentiment: Buy

  • principletrade principletrade May 23, 2016 2:46 PM Flag

    Yeah, I've been hearing some radio ads for LL here in mid-Missouri.

    Sentiment: Buy

  • LL recorded a $16M loss on the tentative issuance of 1M shares last quarter for the class action settlement. Even though that's a non-cash event it was based on the trading price at the time the Memorandum of Understanding was reached.

    If this trading range keeps up it's possible that LL could record a gain on paper when the shares are issued. Yes, it's not actually too substantive, but based on the current sp that would add about 14 cents to earnings.

    Yes, it's a silly thing to be happy about, but anything to help the bottom line is a positive in my view right now since it helps the press headlines and MIGHT help some people realize that it's not a doomsday scenario here.

    LL has a strong balance sheet and the March revenues indicate they are beating numbers from last summer.

    Sentiment: Buy

  • principletrade by principletrade May 17, 2016 11:40 AM Flag

    Spring is a strong season for flooring. It's safe to assume that LL will at-least equal March revenues in each month this quarter. That would make Q2 revenues $258M or more versus $248 a year ago.

    When LL reports beating revenues yoy and sequentially the pundits that never actually delve into the details will be reporting that we have "turned the corner", even though that's already apparent from the Q1 report if you actually read it. We may even beat Q1 2015 revenues. A quarter where LL was mostly unscathed from newcarsmellgate.

    Sentiment: Buy

  • principletrade by principletrade May 16, 2016 5:29 PM Flag

    Spring is a strong season for flooring sales and LL did $86M in March.

    If they equal that number in each month this quarter that's $258M in revenues versus $248M last year.

    LL will have positive comps for sure and end the naysaying.

    Sentiment: Buy

  • principletrade principletrade May 12, 2016 2:53 PM Flag

    To clarify, I meant to say that Q2 revenues will be $257M if they equal March 2016 revenues in each month this quarter, which I believe is conservative.

    It's entirely possible that that Q2 revenues could go as high as $260M.

    Sentiment: Buy

  • If you deduct extraordinary expenses for: Air testing (2.9M) Transporting "tainted flooring" to a warehouse (1.6M) and the added SG&A from Legal and Settlement costs (29.5M) LL would have shown a loss of $7.1M ($0.26 per-share) last quarter.

    If LL equals the revenues from the chart on EDGAR during each month in Q2, that will result in a $257M quarter. BEATING the comp YOY, and adding $7.6M to gross profits sequentially. That is enough to push LL into profitable territory when normalized.

    The settlement costs are already factored into the balance sheet at this point and legal and professional costs should finally begin to decrease.

    LL will BEAT comps and have positive normalized earnings Q2.

    Sentiment: Buy

  • principletrade principletrade May 12, 2016 1:26 PM Flag

    Exacly, especially with the company already under a microscope and several former executives with pending lawsuits for insider selling.

    The insider transaction argument on the short-side is just silly.

  • I've noticed several posts speaking about the cost of the resolution of the class action lawsuit still being an unknown, and I think that misunderstanding should be addressed.

    The 10-Q stated "The terms provide for the use of available insurance proceeds..." and goes on to say they will set aside 1M shares of common stock to a settlement fund. Under no circumstances will the settlement exceed the amount of available insurance, so the settlement will be paid directly from LL's insurers and will be a zero-cash expense.

    Sentiment: Buy

  • Reply to

    Now qtr is behind us and future is cleaner

    by harnashezbollah May 11, 2016 12:12 PM
    principletrade principletrade May 11, 2016 2:06 PM Flag

    Yeah, when there are multiple legal and regulatory issues being settled it's unlikely that insiders could trade. That being said, an insider buying would probably instill some confidence if it was legal or not.

  • Reply to

    Why does Jim Cramer HATE this stock so much?

    by itssofine2 Apr 15, 2016 11:31 PM
    principletrade principletrade Apr 18, 2016 5:16 PM Flag

    In my view, there's no sense in buying HD vs. LL unless you're a multi-millionaire or a pensioner, and paying over 25x eps for a mega-cap is fine because capital preservation is the goal. Home-Depot is a good stock and it's probably a great idea if it's money that you need to retire etc.... BUT!

    HD's market cap is 1.55x revenues
    LL's is what?.... 0.42x revenues, zero-debt, and EPS weakness will prove temporary.

    Sure, LL is riskier, but not as risky as Cramer implies since their exoneration from CARB and recent favorable court rulings. HD could gain ~10% in the next year, but LL could go up 100% with any decent earnings reports. If LL had a five-cent quarter this would go over $20 the next day. It will take YEARS for HD to go up those percentages. Of course that won't happen in Q1 because they'll have too many unusual expenses like legal costs, but that too shall pass. People reading the Q1 report will give LL a lot of leeway.

    I wouldn't "bet the farm" on LL, but it's been incredibly resilient over the last month and seems poised for a breakout.

    Sentiment: Buy

  • That's nice to see this maintaining yesterdays gains. Prior rally's like yesterday were followed by a big hangover in past months.

    Sentiment: Buy

  • principletrade principletrade Apr 13, 2016 3:56 PM Flag

    There's nothing stopping this from going higher into earnings.

    I guarantee there are a few that already know what Q1 revenues were and the stock is doing well. I hate using a cliche, but we saw the same trading action before the announcement that LL won the Prop 65 case and I said it was a canary in a coal mine. There are undertones in what we're seeing now.

    Sentiment: Buy

  • Reply to

    No on news

    by lllongtime Apr 13, 2016 10:51 AM
    principletrade principletrade Apr 13, 2016 11:48 AM Flag

    I think it's shocking that short positions had increased as of early-April. Those bets were likely placed before LL won in court on the Prop 65 case.

    I was calling for a $15 "normal" before earnings, but this has whipped higher even faster than I had imagined. For what it's worth, the SP jumped up to $21 in October and the outlook wasn't as good then as it is now.

    Sentiment: Buy

  • Reply to

    Time to cover

    by awhitersmileonline Apr 13, 2016 9:50 AM
    principletrade principletrade Apr 13, 2016 11:04 AM Flag

    This has been going up relentlessly for several days. This close to earnings, I wouldn't doubt that there are some big-money players that already know the outcome of Q1.

  • Reply to

    Some "broken" brands I've enjoyed lately ...

    by double_el_double Apr 12, 2016 11:39 AM
    principletrade principletrade Apr 12, 2016 1:03 PM Flag

    Yeah, that's specifically one example when I've discussed LL's problems too, and you know what? Jack in the Box was rated the cleanest fast-food chain 2 years later. Just like AUDI recovered from a slam article by 60 minutes in the late 1980's. No big company goes forever without problems. LL has taken its licks, but it will recover too.

    Sentiment: Buy

  • Reply to

    A reminder on valuation and value.

    by marvin_gardins Apr 12, 2016 11:41 AM
    principletrade principletrade Apr 12, 2016 12:08 PM Flag

    That's my long thesis almost identically. Without the bogey of any product liability issues this is worth 2x-3x the current sp.

    Sentiment: Buy