I can't believe you guys are falling for this Robust thing:
* It's a very small part of the business.
* Management is unproven.
* Bars are a limited market.
* Faces brutal competition.
* Energy drinks face a lot of product liability suits.
Gee ... closing excess stores might work for McDonald's, but it's hard to see any closures being positive here, especially when CA was closed at a big loss!
Smart money is dumping RICK ... then investing in the REIT. Pretty much management, Wall Street and their friends ... that is!!!
Need more top line growth ... don't see it!
U.S. textiles industry is busted. And I mean ... with modern liquor stores, moonshine doesn't look like a big growth industry!
Only the bullish news gets publicized!
REIT will reduce debt, but it also reduces assets and real cash flow, because depreciation is metaphysical only. RICK investors will be left with intangible assets while the REIT investors will have hard assets with guaranteed cash flow. REIT looks more attractive; you would rather be in it.
But wait ... you can#$%$ "private" ... only for "qualified investors"! Look it up under the SEC rules!!!
I considered whether this has anything to do with the REIT planning. When one goes through the REIT rules, it could. Guess is, limited partner is going to dump enough stock to bring the family ownership below 10%, but they won't need to make a Form 4 filing because the SEC rules are different than the IRS rules.
Management sounds very bullish on the REIT ... probably because they are going to own a good portion of it!!!
Of course, if some MBA wants to dump 6000 shares in one day, $14.00 ask might work!!!
Here's what investors are missing. Rental rates are tied to the underlying values of the property. If the properties appraised higher (oh yeah ... sure), it means the rental rates will also be proportionately higher. So the net gain to RICK by a higher realty value is ... guess what?
Something has to be deeply wrong. Deep in the vaults ... nothing is there?
That will stop the dancers from filing a class action. But, it doesn't stop the DOL or IRS from bringing their own claims!!!