We go public tomorrow at a price expected to be about 20% of revenues. Most of the competition is over 100% of revenues. Of course minimal profits and high leverage will bring that ratio down. But not to 20%.
Thanks. I haven't felt good about KTCC for over year though I kept the stock. The latest guidance has it as one of my top stocks again.
CECO recently sold a bunch of its campuses for huge dollars and its shares more than doubled. COCO, like CECO has a hidden jewel in its Heald College for which it paid $325 million four years ago. Heald is a old line respected college that certainly has value.
This concerns me. The only companies I ever see that factor their receivables are highly leveraged or troubled. KTCC should have no trouble getting an unsecured line. The only possible reason I can see for this is the sheer size of the financing.
I spoke with the company about this. The $50 million line is in addition to the existing $30 million unsecured line. The discount rate is similar to the interest rate on the $30 million line. That gives me comfort. They don't have any immediate plan for the money. My guess is this is for expected growth rather than for an acquisition. Acquisitions are usually funded by term loans not lines though they can sometimes be funded by a line temporarily.
It is a line. Just set up differently in that they have to sell receivables to get the money. They can get up to $50 million from selling receivables at a time.
What is a share buy back going to do? Share buy backs are to increase earnings per share. They have no earnings to increase.
Think Kim Kardashian is an untalented publicity seeking average looking wanna be? According to Forbes since GLUU launched her mobile app Kim Kardashian: Hollywood a month ago it has racked up $200 million of revenues. GLUU is up like 80% and Kim gets 45% of the profits which is a lot since most of that revenue is profit. All I can say is Anna Nicole Smith was before her time.
It should be more than that. My calculation is shown below;
18,742 oz x $1,300/oz = $24,365,000
1Q Revenue 15,624,000
Increase in revenue 8,741,000
The increased revenue should result in little increased expense. I will assume production costs increase 10%.
Recurring Loss in 1Q -3,400,000
Increased Production cost- 1,063,000
Royalty, 3% revenues -731,000
Increased Revenue 8,741,000
Net Income Before Taxes $3,547,000
Since they have NOLs to cover taxes, that will essentially be their net income. It is $0.02/share.
Expectations were lowered so much that it may go up even with the earnings miss. I like the market share gains. It adds more fuel to the fire when the housing market picks up again. For now however, the housing market is in retreat.
The estimate was $0.35. Actual earnings were $0.31. They missed by $0.04, all due to what hopefully is a temporary spike in claims in long term care.
Guidance of $0.08 to $0.10 non-GAAP next quarter means $0.06 to $0.08 GAAP. The non-GAAP needs to be ignored as it excludes stock compensation a trick some management teams do but shouldn't. Assuming the midpoint of GAAP guidance and applying a PE of 15 due to the recent strong growth gets the stock price to $4.20.