LQDT knows that a Rolling contrct can cause sudden pain. A fixed term Contract is more stable. Further due to the sudden increase of insurgencis in the world, the market price of spares has soared. In the Middle East a used Heli rotor goes for twice its original price.
Because of this DoD bids have increased and will continue to do so till we have a more stable world. LQDT is on the right track.!
Wishful estimates. The Co. is mired in debt. Interest rates are expected to rise in 2015. Steel surplus is trending up demand has dropped and old mills cannot be closed.
We have seen the high for 2014. The next leg is down.
More of the same & possibly bigger losses.. Dont forget the eternal flame of hope.!
New low for 2014 will not be a surprise.
Not quite. The Co's annual n earnings are closer to $1.60. The Co. has over $3.0 bn debt. It has lost $125m in Hedging a routine .! No one knows what the Cotango is for the pending contracts.
If any one was interested it would make a move when the stock is lower not higher. In any case $55 is overly optimistic.
They have consistently lost money on Hedging. Losing $125m (58c/sh) is shocking. Mgmt needs to control their gambling in light of the fact they have been overwhelimgly wrong for the past 3 years.
Good luck .Those earnings remain elusive because of debt and inability of Mgmt to take a large write down of assets for illiquid plants in Europe.
FDA Inspection deficiencies are not that easy to fix when they involve modifying the assembly line process. The FDA has pointed out that weighing of each ingredient & other stage inspections as was stipulated in the agreed MOU was not done.
Any Q.A person will tell you that either there was serious misunderstanding in the chain of command or else a flagrant disregard to proceed stage by stage with internal Q.A being rigorously documented to identify the stability and validity of the process.
The Attorneys should have a field day if they can get hold of the internal Q A documents and rightly so. This is the 3rd time .
The infractions are not minor. They require time , resources and manpower to re engineer. to meet spec.
The Hayward plalnt faied inspections and now theTaiwan plant.
It goes to show amateurs stay amateurs for a long time.!
No large buys. Infractions listed reflect on the quality assurance. This cannot be changed on a dime.
Don't be surprised if it takes 2 years for a reset. Good luck.!
The Balance sheet only reflects tangible debt. They don't mention intangible debt which may be nearly as much. The Co owns plants which have environmental liabilities . Some cannot be closed down as the Unions are protected by friendly Govts.
The Co. needs to take a write down and sort out the uneconomical plants . I don't foresee any upside till the end of this decade when steel prices are expected to rise.
This time may be different as citizens in Countries in conflict and turmoil are quietly switching out of N.A debit/credit cards due to effect of sanctions and freezing of accounts.
Air crashes are very expensive. Nearly 70% of passengers have a visa card When a crash site is not thoroughly secured , locals search bodies and often steal wallets/cards etc.
The credit cards are sold within 5 mins for a fixed sum. The BUYER then sells the card info overseas where the account is tapped into the max within 15 secs. I expect V could be down for two or more Q's.
My F.A says there is an Industry change of P/E due to exceedingly high payouts for drugs and fraud. I sold 60% as I believe we will head lower to make a new bottom.
Recovery will take at least 2Q's.