The current 20% discount to NAV is misleading. It does not take into consideration the dilution from the offering. Once the offering is effective and dilution happens, the NAV and discount to NAV fall significantly.
Got a call from another finance professional. We discussed this offering. This fund normally makes a YE distribution in Nov. It's already Dec, they have not yet announced their YE distribution. There is no clarity around how the YE distribution interplays with this offering. Unless the timing of the YE distribution is understood, it would be unwise to commit to the offering.
Worse case ... You give them money on Thursday with an understanding that share price will be about $7.40, NAV around $9.10. Assume max offering so diluted NAV comes in around $8.44. That would work out to a normal discount to NAV of about 11%. That's fair.
However, what if they pull a fast one .... after Thursday but before new money becomes shareholders, they announce YE distribution of say, $1. They make the record date before new shareholders come into the fund. The end result is a buy-in at a discount to NAV appreciably lower than the normal 11% ... thereby intentionally misleading new money ... giving them a terrible deal.
Until they put their YE distribution plans on paper ... it would be unwise to take down new shares.
Are we wrong?
Welcome to Corporate America, where theft is legal thru bloated salaries of under-performing CEOs. Nothing new, unfortunately.
What do I think about 10% dilution to our investment via stock options? I'd rather not have to think about having my pockets picked by managers who don't perform.
These clowns doubled the size of their plant, hired more executives, and profits declined. Remind me again, on which planet does this qualify for issuance of MORE stock options?
A buyer wanting 2,000 shares @ 6.30 actually showed up today. And here I was thinking WSCI would go the remainder of the year with 0 shares traded. What a weird sensation ... seeing someone who wants to buy this stock.
Yeah, and the sad part is that DCO's mgt was head and shoulders above these MTRX clowns.
Back when I was ranting on DCO, more than a decade ago, it was in the 30s. Fast forward 10 years and 30s would be a gift. Companies with miserable mgt teams don't perform. And as far as mgt teams go, MTRX is one of the absolute worst I have ever come across. Even more so than DCO.
Did you read the earnings call transcript carefully? Notice in the call the earnings problem was overhead spread across lower revenue, primarily on 3 jobs that started later than hoped. However, revenue was up 30% YoY and SG&A as a % of revenue was flat. It's like saying 1 + 1 = 11 ... does not compute. And if that wasn't confusing enough, the idiot CFO let slip in one of his answers in Q&A that there was 1 highly problematic job ... huh? Which one? Why? How much of an impact? One of the 3 blamed for the shortfall, or yet another issue? ..... it was just too much of a clown show to walk away feeling like these guys were doing anything more than making stuff up as they went along.
Pathetic. Just absolutely pathetic performance.
Take your eyes down about half way on page 5, to the last question from Matt Duncan, the Stephens analyst. Matt simply asked ... what are your plans to improve your margins? Read the response from the CEO and CFO. Yeah, me too. I was so embarrassed for these guys that I want to close my eyes and pretend like they could have a do over. I have never read such a rambling, bumbling, incoherent response to such a critical question, EVER. And I've been reading earnings call transcripts and listening to calls for a couple decades.
These guys are operating by the seat of their pants. They have no clue, no plans, no idea how to manage their business. That much is crystal clear from reading the response to this one very simple, but critical question ... You've told us you have a focus on improving your below average margins, so tell us ... what are your plans?
Clueless Clowns. John and Kevin should be deeply ashamed and embarrassed at their performance on this conference call. I know I am truly embarrassed for the both of them. And I'm ashamed that the Board of Directors of this company have not moved to install a competent management team here.
This conference call was absolutely pathetic.
Corporate jargon galore
Devoid of detailed insight into operations
This call was an example of two senior corporate executives of public companies who are totally out of their league.
Don't look at our pathetic operating performance ... look, look, over here ... we're going to throw a couple pennies in a hat, pull a rabbit out, and buy back such a miniscule amount of stock that it won't make a hills beans worth of difference. But, we're going to pretend like it's a huge benefit to bagholders ... er, shareholders.
What a bunch of idiotic clowns.
Oh please. Ranting? If so, it's direction at the sorry management of this company is WELL deserved. That press release was an effing joke. It read like a stupid sucker's game of guessing which shell the ball is under. We missed our earnings estimates by a wide, wide margin, but look, over here, it's not really our fault. We just didn't start our jobs soon enough! And look, over here, we got another contract, And look, over here, we can lay on the ridiculous corporate jargon, so thick, that we can talk in circles all day long and pretend like we know what we're doing. And look, over here, the news of our pathetic results didn't really leak. Just ignore the FACT that the stock sold off HARD, on HUGE volume, and mere 45 minutes before we released our earnings to all the bag holding shareholders, while our friends and family hit the exit.
How well do I regard this management team? I'd rather have my money invested with the Ivory thieving Leaders of China, or the Oil and Gas Thieves running Russia ... than these lying sacks of garbage who run MTRX.
Apparently, I'm not alone. The market is also in agreement. They also see the lies and deceit that these CLOWNS tried ... but failed at, miserably. And along the way? They absolutely DESTROYED their credibility.
If these morons running MTRX had an ounce of integrity, they would have announced that they missed earnings and given us very specific explanations as to why. They would have given a hat tip to the suspicious activity in the stock and taken the lead in asking the SEC to investigate. And they'd speak simple English in their conference calls ... rather than acting like idiots in talking all their stupid corporate jargon.
Mgt CREDIBILITY is a problem here. A big problem.
Starting at 3:15, the stock fell off the end of a table, and volume picked up massively. 45 minutes later, the market closed. 15 minutes after that, surprise ... missed EPS estimates by 50%.
Someone(s) knew. This news leaked. Where is the SEC on this cr*p? Why can't the company keep a lid on its financial results?
Just #$%$. is going on here? Mgt letting friends and family in on insider news before shareholders?
TGI will be buying all of the divisions that SPR has on the block ... divisions that LMIA does a significant amount of work for. So, what happens then? TGI tells LMIA to take a hike. That work winds up getting transferred over to other TGI divisions. LMIA winds up sucking wind. Yet another legacy of Ron's endless stupidity in acquisitions. That man was a wrecking ball of shareholder value, in spades. Yet, he walks away a very rich person. Incompetence pays in America is the only lesson one can learn from LMIA, a disaster of a public company.
Yes, very disappointing that their earnings declined after a double of their plant size. They got negative leverage off the capital investment. I still suspect some of that might be temporary. Although they haven't disclosed it, I'm still guessing that costs associated with the April/May product recall were not insignificant. And their operating costs have probably gotten ahead of the relative plant capacity increase. Didn't the added machines and bigger plant cause them to run out and hire another layer of management? Operations Manager or Director?
Other than acting as a primary vendor for Polaris, I think we're going to need to accept the fact that WSCI's future lies in being a go to for spillover product demand. Perversely, our nation's increasing energy production (although that's not leading to increasing sales in WSCI's energy biz) is causing our dollar to strengthen. That's only going to make matters worse for WSCI in the future. Buying from overseas machine shops will get cheaper in the future relative to domestic producers like WSCI. We'll be relegated to only serving quick delivery needs. That's a very tough, less profitable, position to be in.
And .... maybe the prospect of a strengthening dollar is the primary factor that keeps a ceiling on this stock now, and for some time to come.
Yep. Makes sense. Same ratio as me of shares given in oversubscription ... to ... shares from exercise of original rights ... 4889/1428 = 3.424.
Yes. There were journal entries hitting my acct at Fidelity before the mkt close today. At that point, I could have called in and they would have let me know how many shares I got from any oversubscription request. Then, I could have simply shorted that many shares and closed that short against shares delivered from the rights offering. I suspect that's what you were seeing today, and most of that was likely coming from hedge fund activity. However, most of the selling action will happen tomorrow, when people will log in and see the shares in their accts. Tomorrow (Tuesday) should be a massive volume day that will put today's volume to shame.
IB. Just posted (10/27). Oversubscription results. Requested ratio, oversubscription shares to shares from exercise of original rights 23:1. Actual allocated 3.4:1
Fidelity. Posted to my acct after mkt close today (10/27). Was able to have them immediately journaled as an offset to existing short position to stop the meter on carry costs on the short.
IB. Nothing yet. Probably before open tomorrow (10/28).
Just got off the line with Fidelity. Some funky journal entries were hitting my acct. within the last 10 to 15 minutes. They are making the necessary entries to deposit the shares into the acct after market close today. So, they will be available for trading tomorrow.