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Scott's Liquid Gold Inc. Message Board

baaadapple 44 posts  |  Last Activity: Feb 4, 2016 5:23 PM Member since: Nov 21, 2001
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  • Reply to

    LTC is the Titanic...

    by tradingadollar Feb 4, 2016 5:13 PM
    baaadapple baaadapple Feb 4, 2016 5:23 PM Flag

    LTC actually had a decent quarter. Showed some improvement. Not sure what happened in life insurance.

  • Reply to

    Basically, Holdco has more cash than market cap

    by ari_mail Feb 4, 2016 5:13 PM
    baaadapple baaadapple Feb 4, 2016 5:20 PM Flag

    The level of cash is irrelevant for an insurance company. All insurance companies have lots of liquid assets. The more cash the less assets earning interest. The level of capital is important.

  • All GNW needs to do is meet the $0.21 estimate and we'll be back over $3.00 faster than a prom dress comes off. If they beat, then it's off to the races.

  • baaadapple baaadapple Feb 3, 2016 12:08 PM Flag

    The contract kicks in during the quarter we are in now. It will be somewhat front loaded as a lot of the fees will be for customization, which is done upfront. Almost all of it falls to the bottom line as the company already has the personnel in place to service the contract. Not sure what happens in the earnings announcement next week, but the one after should be BIG!

  • baaadapple baaadapple Feb 3, 2016 12:04 PM Flag

    The auto leasing industry is much smaller around the world than the U.S., especially in areas that Netsol is strongest. Lots of opportunity.

  • Reply to

    I do know one thing

    by brillo_us Feb 2, 2016 11:15 PM
    baaadapple baaadapple Feb 3, 2016 12:02 PM Flag

    brillo, selling now is like catching a 20 yard pass, straight arming the defender to the ground, and then with only daylight ahead, running out of bounds. Victory is at hand. The contract kicks in bigtime in the next quarter's earnings announcement. Almost all of the contract dollars falls to the bottom line since the company already has the personnel to service it.

  • The results in the stock contest a symbolic of the market as a whole. The investors on this board are mostly small cap value investors like myself. A look at the Russell 2000 indicates this type of investing is out of favor right now. The Russell includes growth and value, small cap value is down more than the Russell 2000. I have somewhat mitigated this by selling much of my portfolio in late 2015, including KTCC, and am now 62% in cash and 9% short. I believe there is more downside from here as a recession is likely based on what has happened in the past three months.

    What has happened in the past three months? Well every high end retailer in the U.S. reported big misses and warned going forward. Retail spending growth which had been declining all year, fell to flat in December. Remember consumer spending is two thirds the economy. Trucking is the canary in the coal mine. The majority of U.S. trucking firms warned things are slowing. Commodities, not just oil, have continued to drop. Manufacturing turned negative. Drug companies are facing price pushback they never faced before. Subprime consumer loans are suddenly seeing increased delinquencies. Junk bonds are declining in price and facing liquidity pressure. Short term interest rates increased. IPOs have dried up. Exports are accelerating their decline. Inventories have built up. In just the past month earnings estimates for the Dow Jones Industrials have decreased by 3%. These issues are mostly sudden and sobering. Further, a whole host of industries that were weak a year ago have gotten weaker, as have foreign economies.

    Time to raise cash so you have dry powder to profit from the inevitable economic recovery. Small cap value stocks do poorly in a recession but great in the following recovery.

  • Reply to

    Dows down 380+ GGP up $1.20

    by rlbakes Jan 15, 2016 11:25 AM
    baaadapple baaadapple Jan 19, 2016 8:58 AM Flag

    Brookfield is buying someone, Rouse. Rouse is much cheaper as a multiple of FFO than GGP. It should hold up better than GGP which will lose a lot of its anchors over the next 3 years.

  • Reply to

    cut in half,yes after split form 100

    by leech_on Jan 16, 2016 9:42 AM
    baaadapple baaadapple Jan 16, 2016 8:46 PM Flag

    I have one word for you........Sears.

    You want more words?.... How about JC Penney, Bon Ton and Macy. All are closing mall anchor stores.

  • Reply to

    Dows down 380+ GGP up $1.20

    by rlbakes Jan 15, 2016 11:25 AM
    baaadapple baaadapple Jan 15, 2016 2:33 PM Flag

    Brookfield is much smaller than GGP so if there is a merger GGP doesn't get a premium, just more debt.

  • Sales declined and worsened each month of the last quarter. No surprise as U.S. manufacturing is in decline due to the strong dollar and weakness in energy. This trend is likely to continue a while. No way this stock should have a PE of 20 right now.

  • baaadapple baaadapple Jan 14, 2016 7:50 PM Flag

    Well first the bad news. Earnings at $0.31 were below guidance of $0.34-0.37. However sales were in line and waaaay up from last year. My guess is they got hit with some last minute expenses for the closing of the real estate deal. Stockteam, you nailed it, the big news was the sales for December of close to $8 million. At that pace they are over $100 million annually when you factor in seasonality. Earnings were hurt in the last quarter by a lot of overtime paid due to the growth. They hope to eventually get to a net income margin of 9-10%. Last quarter was only 5%. If you apply 5% to $100 million of sales you get net income of $5 million or about $1.25 per share. With the growth rate they are getting, a minimum PE of 15 is indicated which would put the stock price at $18.75. There is a limit to how far they can grow this market but I can see them getting to $200 million without adding new product lines and a net income margin of at least 8%. That would put earnings at $4.00 per share and a stock price of at least $50. They may get there within two years at the current rate of growth.

  • baaadapple baaadapple Jan 13, 2016 9:44 AM Flag

    The sale was almost certainly to cover the cost of exercising the options. Very bullish.

  • baaadapple baaadapple Jan 13, 2016 9:42 AM Flag

    You completely missed what he did, it was actually quite bullish. He exercised on option on 33,333 shares and sold less than half of them. So he now owns more shares.

  • Reply to

    Cash on Balance Sheet

    by ari_mail Jan 11, 2016 10:35 AM
    baaadapple baaadapple Jan 11, 2016 1:36 PM Flag

    I don't think you understand insurance companies. Cash along with investments are needed to cover benefit reserves. All insurance companies have a lot of cash and investments. A lot of cash is actually a negative because it means less investments earning interest and dividends. The real metric to look at is net worth. GNW does have a much higher net worth than book value.

  • Here are the reasons

    1. The FFO multiple (which is like a PE multiple but for REITs) is very high at 23.4. This multiple indicates investors are expecting significant and sustained FFO growth.

    2. FFO growth is likely to slow and even decline due to a lack of growth of sales from mall-based retailers.

    3. Mall-based retailers are more exposed to online retail than other retailers. Their margins are being pressured by Amazon which competes on price since the stock market allows it to get away with little profit.

    4. General Growth has a huge exposure to three weak money-losing anchors, Sears, J.C. Penney and Bon-Ton. Over half their locations have a Sears and over half have a J.C. Penney.

    5. If these anchors go bankrupt or close stores, they will be very difficult to replace. Few are currently adding department stores to malls anymore. This has never been a problem before.

    6. Retail sales in general are below average and growth is declining

    7. Retail sales are cyclical, and the current economic expansion is getting old.

    8. Amazon appears to be gaining market share faster. It just announced that more than 23 million items were ordered worldwide from sellers on Cyber Monday, a 40% increase year over year.

    9. The dividend is low for a REIT at 2.8%. That reduces the cost of shorting.

    10. General Growth was hit hard in the last recession. Though it is less leveraged and smaller, its tenants still have the same profile. This indicates FFO will decline in a recession.

  • Reply to

    Any News?

    by richrusso300 Dec 30, 2015 1:25 PM
    baaadapple baaadapple Dec 30, 2015 2:52 PM Flag

    The drop is on average volume, and this stock does have a history of large moves in one day in both directions.

  • baaadapple baaadapple Dec 29, 2015 12:00 PM Flag

    Knack, everything you mentioned is inaccurate. If you talked to the company you would know that.

    1. Most of the contract is new money

    2. The contract is front end loaded. Th license and maintenance fees are over ten years. But there is also an implementation fee that goes the first five years only and much of that will be the first few years. This fee will cover their implementation expenses.

    3. NTWK does not have a history of blowing contracts. This is not their first NFS contract either. This is the only thing they do, they know how to do it.

    4. You have no source to point to to say this is not a $100 million contract. Now your just making things up.

    What you are really missing here is NTWK already has the people in place to cover this contract. That means most of the new revenue falls to the bottom line. It WILL pop earnings, starting next quarter.

  • Reply to

    My EPS projections

    by working_on_1st_million Dec 21, 2015 1:04 PM
    baaadapple baaadapple Dec 23, 2015 8:23 AM Flag

    Don't think this $100 million customer is Daimler.

  • Reply to

    I spoke with CFO Roger Almond

    by baaadapple Dec 22, 2015 1:33 PM
    baaadapple baaadapple Dec 22, 2015 5:05 PM Flag

    By my calculation, this contract adds about $1.5 million per quarter to after tax net income. This will probably start in the March quarter, definitely by the June quarter. There is one analyst following NTWK. This should get a lift when that analyst updates his/her model.

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