What do you know? Could it be that the shinola is off the rose, and that TUES is starting to react like a normal stock instead of an overhyped turnaround. Could it possibly be that investors are asking show me the money and not worshipping at Golden Calves. I mean that this incredible management team has now doubled the estimated loss for 2 Q's in a row, and the next day instead of going up sifinificantly is actually goes down. No way, you say can't be, and what are you smoking? But, yes, it did, and perhaps, and I really hestitate to think it,
the blush is offf, and that retailing growth is more than clearing out old inventory and lowering the imu. It actaully means that your net is also going to be a lot lower. Hello. The yearly estimate is $0.35 from the Kool Aid drinkers that asked the questions during the Q & A. Gee, and wait til they start adjusing that down, which should be real soon. Then the ship jumping will really start to happen. For TUES to even make a dime, Christmas, would have to start July 1. Ain't going to happen. 2-3 years and Sayonara.
While not as heavily as you, I am, for me, very heavily invested in SPNS. I can't for the live of me understand something and perhaps you and explain it to me. SPNS has some very strong products, including the two new ones, that you mention in your post, Decision and the Retirement Recoding Keeping, both of which are proprietary, I would assume. With all of this wonderful future that supposedly exists with SPNSand forgetting that they won't increase the eps to aid long-suffering shareholders because they have decided to invest R & D to develop these "wonderful new produsts" can you please explain to me why their gross margin dropped over 5.5%?
Proving the point that there are not a lot of "closeouts" out there that are not procuced against orders from TUES itself, and not 'department stores closouts' Again, none of them ROST, TJX, TUES have any more than 20% goods in the store that are not produced speficially for them. And TUES is last in line after TJX and ROST so if they do get anything it is only what the others have first refusal of.
I am short the stock and have litte hope for it's survival as ROST and TUES are the toughest competitors out there, and to think the MIchael's people, who competed against Joanna stores, is going to take market share away makes no sense to me.
Wow, you took the words out of my last 20 posts, there is no way they can compete with ROST and TJX. "Period." (to quote Obama.)
I do not "speculate" about closeout merchandise, I am softlines manufacturer who sells to all three, and all of these stores have 80% production goods in their stores. Do you possibly believe any manufacturer could stay in business supplying 3600 stores with 'closeouts' there are not enough of these goods in the world to keep that many stores stocked on a regular basis which is why they have to buy production and not wait for the few closeouts that exist.
This just keeps getting better I looked at the bottom of the TUES page on my Morgan Stanley account and they have two analysts they quote, from Reuters, as following TUES and they are estimating 2 Q eps, which is Xmas period for TUES, at 49 cent for the Q. Oh, my, oh, my, there is going to be a blood bath when they come up short on that one, I am personally estimating they will be lucky to break even. Any idea when they will report those figures? I am thinking maybe mid Feb? Thankfully, my puts have a date of Mar 14.
Let's see how great these new guys do against ROST and TJX and how long they can stay in business before you judge KM. I am betting two years at the most.
Estimate was to -7 cents and it was -14 a nice double. Their gm is down 3%, so even though they are increasing sales they are making much less money.
But notice that they have over $70ml less inventory than last year, Q to Q, and a whooping $13.3 ml in cash to show for all the sold inventory. Not what you would call, exactly, a growth model. 3 years tops.
This idea of a "closeout" business is not reality. I sell to both TJX and ROST and the even though they have the public convinced that they dieal in closeouts, seconds, irregs, and merchanidise that department stores have canceled, at the most what they call "special purchases" makeup 20% of their mix.The other 80% of the mix is what is called "production" and that is what the supposed "closeou" biz is today. Ralph Lauren's bigest customer is TJX they have a special collection made just for TJX.
When KM came to TUES she brought TJX people who know the business and apparel is where the $ is made, the idea that a hardliine reatiler like Michael's people can turn around a soft lines biz is not only ludcrious but will end in 'closiing out' all TUES stores. Period. Operationally, they can change the stores but $ is made from merchandise not from new cash registers.
I can certainly understand what you are going through. And I must admit this is like trying to catch a knive going up. My original short, before the lq earnings, when pps was at $10 and when it shot up the nest day to $11 plus I took my beating quickly. And then I waited and watched nothing, absolutely nothing has changed except the pps, at $14 I couldn't resist and went back in but this time with March '14 puts, $15 strije, and when I saw $17.50 went back in again on the March puts.
I must admit, I do not know the people in charge of TUES, but I just can't imagine that they are so smart and know so much about retailing to do it. It will take a tidal wave, nothing less than a deux machina has to happen for this company to survive, let alone, be profitable.
I appreciate the thoughtful feed back. And I put to you, that JCP and SHD both had much better balance sheets when they downward spirals started. TUES won't get cut the slack these two much bigger guys did. The bleeding will be dramatic and once that happens the Factors will head for the doors, there merchandise flow will be cut off and Poof they gone if not 2 than 3 years, but no longer
It is amazing isn't it? They beat the estimate by doubling it on the down side and the stock goes up. Did the same thing last Q. Then the stock went up maybe 2 points. No one seems to understand you can increase sales by lowering your mu but you also make a lot less $. At least today, it seems, that the initial euphoria has worn off. If reason prevails this stock should be 8 a long way to go on the down side before they go good bye.
Getting sued by these #$%$-suckers is becoming a badge of honor, as OSIR results today show. Is there any lower form of life than being a lawyer? If only a lawyer had to pay for all goundless lawsuits, in damages to the party sued, for these suits than they might go away
Be careful what you "wish" for, you should get another chance in the 11's real soon. I wouldn't buy long but it's your money to do with as you like. I just would strongly advise, at the very least, to wait to see some progress before you do that. Right now the entire price, at these levels, is based on some one's reputation and, regardless of how good he is, he is facing a monumental task of turning around a retailer that has lagged behind for a long time. And really has lost it's raison d'etre for being in business, at all.
First and foremost, I am not against you. I love it when people make money in the market, myself included. However, the fact that you made money while TUES didn't proves, what?
And that's my point the price of the stock has nothing to do with reality. And that reality is they need to make money to justify this rapid rise in the stock. and neither you nor any one else can do that, can you?
TUES, at $15.50 is selling at 40x this years estimated eps of $0.35. If I could get my ROST stock to that PE I would be ecstatic and ROST has a track record of amazing consistency and it sells for 19 PE which is very high, the highest it has sold was at a 20.5 PE. Some people are going to be very, very disappointed when reality hits TUES.
There is one line in the agreement that you have to love: "Osiris may also receive earnout on sales of acquired products, ranging from low single-digit to a 10% cap on annual sales in excess of US$750 million." So, if indeed this does become a major source of income to MBST, and why would they spend this amount of $ if they didn't thiink so it 'could' become almost like an annuity to OSIR.
And once again the stock reacts favorably and goes up a ton. Must be something I am losing in translation. They doubled the estimated loss. Can't imagine that vendors selling them with orders for next spring and seeing the that all they have is 13 ml in cash aren't concerned, however obviously the people running to buy this stock are not. It's like trying to catch a rising knife.
There are only so many Q's in a row you can lose $ and lose more than the estimate. Eventually, people will start to see the reality of what is happening if they continue to lose Q after Q.
I do take it as a very good sign that it did not finish up as big as it did after the last losing Q. The next few days should be interesting to see what happens maybe the blush is off a little at least.