I copied and pasted that from direct investment data. Not sure who that is? But I like their analysis:
"The low EPS is the result of ERB doing what a company is suppose to do in providing shareholder value. Net income was reduced by a massive increase in R&D spending for the 4th quarter."
"Net income would have been more than double the reported income."
"Expect ERB to bring new products to market and grow revenues and EPS for 2014 and into the future."
I count over 10 different research firms with buys on ERB - Zacks, Stonegate, Equities...
More research showing ERB's increased R & D spending 100% otherwise net income would have been more than double. Net income increased 400% even with the doubling of RD spending.
ERBA Diagnostics Hidden Value (nyse: erb)
On Monday ERBA Diagnostics reported their earnings for FY '13. The earnings have been regarded as a miss by investors resulting in a price drop of 18% from Monday through Wednesday's Close. ERB reported 2013 EPS of $0.01 per share (diluted).
ERB reported revenue growth of 46% over FY 2012 resulting in $28.3 Million in gross revenue for the year. The low EPS is the result of ERB doing what a company is suppose to do in providing shareholder value. Net income was reduced by a massive increase in R&D spending for the 4th quarter.
The Q3 report listed year to date R&D spending of $933,000. The full year R&D spending totaled $1.92 nearly doubling the R&D expense from the 3 previous quarters combined. The spending increase for the 4th quarter is nearly $700,000 more than the previous quarter spending of about $205,000. If R&D spending had stayed in line with previous quarters the full year net income would have been more than double the reported income.
Expect ERB to bring new products to market and grow revenues and EPS for 2014 and into the future.
There are many people and even institutions that have been buying and accumulating a position in ERB.
Very few traders if any are buying selling. The volume is too low and the spread is too wide for day trading ERB. While you may want heavier volume and tighter spreads, it is great news for ERB that traders are unable to trade it.
It speaks to the quality of the volume. Rather than a bunch of round trippers inflating the volume numbers we are seeing actual investors buying and sellers getting out. This creates a base for support and eliminates the overhang or resistance.
Friday is a perfect of example of things to come. Now that millions of shares have traded between $3 and $4 there is hardly anon left to sell at this level and when buyers need to buy ERB flies. The question is how high will it have to go to attract enough sellers to satisfy buyers.
Buyers are hypothetically unlimited while sellers can only be people who had already bought some of the float. The float is tiny and IMO the sling is done, finished, kaput.
My guess is when ERB trades $6 - $8 there will be some sellers that bought $3 - $4 who will sell. Then we will see the same pattern of buyers getting invested and off again to higher levels.
I have tried to explain ERB on here. It is so easy to see what is happening. Gladly there is still a chance to buy more and I have done that. Not finished yet. Strong fundamentals and fun times ahead.
When leadership fails or even punishes shareholders like this - RED FLAG. Who wants to own shares in a co where management destroys shareholders losing 50% of the value in one day? All to get cash so management can pay themselves inflated salaries.
If new management came with the money maybe then there would be a positive. As long as management are destroyers of shareholder value it is a stock to be sold, not bought.
This is as bad as it gets for shareholders.
Hard to believe it is legal and management will get away with it and not be held accountable.
You guys will be surprised what a waste of time it is to concern yourself with $3.50 - $4. ERB is going to be $10 and then $20.
If you worry about the small stuff you risk missing the boat and bigger picture. All these buys are gifts now that ERB is on its way.
Rather than worrying about the daily ups and downs of ERB I bough more shares. IMO we will soon see ERB continue its rise on the way to $10 and then $20.
When ERB crosses $10 I hope to own enough so that I will know that I took advantage of the weak longs and bought sufficiently to take advantage of one of the best investment opportunities I have ever seen.
If you have read my posts you will know I am being sincere. And do not mistake my buying shares as anything other than what it is. I have said before I feel much stronger now with ERB at $3 or $4 buying shares than a year ago buying ERB at $1.50. The fundamentals are just so strong now and the undervaluation is as compelling as it gets. The technicals are just confirmation.
Buying on any pull backs will prove to be tremendous. Thankfully we have one. Before now there have been very few opportunities. It is hard to buy new highs. Not bad just a little harder than buying pullbacks. I bought a 10,000 lot without moving the offer which is not always easy to do.
It will be fun selling those shares at $20 or better. Maybe a lot sooner than you think.
Upon reflection maybe I a overthinking the quote. Maybe you were trying to illustrate even in the most unlikely places it is universally true that people are often easily manipulated as is the case in ZBB.
What is crazy is that while I agree with you, there is a possibility a simple person might luck out buying a stock based on squiggly lines on a chart or a misleading article and still end up making money. I wonder if there are more millionaire lottery winners or historians?
No doubt the Germans were smart in spite of their misguided leadership and morals during WW2. To get from the lows where they were after WW1 to almost pulling off word domination a couple decades later. People will always follow and especially a strong leader.
Maybe Scott was Goering and following eventually drove him mad? Seriously. Who know? But I remember vividly driving with him in his car to a couple meetings and tours and he did seem out of place. But perhaps he was the perfect patsy yes man fall guy they wanted?
Africa seems too far away and powerless along with lack of natural resources to worry too much about. But maybe I am wrong. The ME, China, Korea and Russiais to me are the powder kegs waiting to explode.
Japanese gold? I imagine reconstruction saw Ally opportunists taking the spoils. Post WW2 Japan had a quick turnaround from devastation to economic domination. Maybe the spoils along with our money fueled that. Just guessing. Do you have the answer?
As I think about it the biggest asset ZBB has is the public shell. The shell has made more money for ZBB than any sales of products ever have. By a wide margin.
So with the bridge loan and other deals any terms to transfer the assets to the insiders misses the boat. Rather than giving the assets away to insiders for a little capital, giving the shell to the insiders would be the best way to transfer wealth to insiders.
Oh I forgot. The insiders already control the shell and use it like a fox in a hen house. And when the music stops and there is no money left, the insiders will find a way through "legal" means to transfer the assets to themselves.
But as you say, our gov prints money, sends kids to protect assets... Lots of places to look for self dealing and self interested folks taking advantage of the public.
You would love ERB if you met the management and understood their vision.
Agree with you Jeff. Gov can print money for only as long as people believe he emperor is wearing clothes. And waiting too long until the problem is too painful is the likely course.
Perhaps a natural disaster like another east coast hurricane or manmade one like terrorism or nuclear bomb will get the funding necessary for grid and infrastructure spending. Then ZBB might have a chance? But here is plenty of competition now and it appears that ZBB has been left behind as even the tiny amount of business out there is happening without ZBB winning any contracts.
Yet ZBB sticks around as its cult status enables enough stock buyers to inflate the stock to allow Eric to sell stock at a discount as an ATM to fund the salaries and overhead.
BTW I wonder if management is able to finagle moneys for themselves in other ways in addition to salaries? China, offshore entities... How about $1M per month in losses? ZBB basically has zero business. Yet they spend over $1M each month.
Maybe some of that is finding its way into mgmt pockets? Wouldn't put that past them. Would you? The board is a pocket board and there has been no repercussions from destroying all the shareholders. I imagine that would embolden some creative ways to enrich mgmt at shareholder expense even beyond what we see every day.
If you think about it. What is the difference? If ZBB raises money and destroys shareholder value and the money goes to pay overhead and salaries with zero chance of selling anything or making money. Isn't that pretty much the same as simply taking the ZBB cash and putting it into mgmt pockets? Maybe I am confused? Jeff - a little help.
BTW - Africa?
ZBB has lost money consistently. Even now they burn (lose) $1M each and every month.
Think of ZBB as a biotech. They are working on a solution to a problem. They claim to already have a couple products. But after many years their sales are negligible. On the promise or hope they may sale products in the future ZBB has been able to stay alive by selling stock under the market destroying shareholder value with dilution and reverse splits.
In fact many such transactions (I think 6, not exactly sure) to loan shark type PIPE traders enabling ZBB to stay alive continuing to promise sales but never deliver.
In such a scenario it should come as no surprise that ZBB insiders own very little stock. In fact they earn a lot of money in salaries and the board even gets paid salaries. Unless that has changed? That is a major red flag in by book.
Meanwhile what has ZBB done for shareholders? Nothing. Everyone has lost money except for insiders earning salaries.
Andy - ERB's diabetes efforts are a perfect example of what makes ERB a ridiculously cheap stock with such a bright future of growth and earnings.
Recently (as ERB promised) they made 2 acquisitions of non ERB companies. Drew and Jas for cash - no dilution to shareholders. Both primary products are Diabetes tests, reagents and instruments. Before these acquisitions ERB had no Diabetes products.
ERB was able to add these FDA and CE approved diabetes products to their stable of 200 FDA approved products and 300 CE ones. ERB also added the customers of Drew and Jas.
ERB was able to buy for an attractive valuation as they had a lack of scale and high overhead. Immediately ERB fired the overhead, slashed costs, boosted margins, closed the factory and offices in the UK and Dallas and brought production to Miami...
This takes time and money, but already we can see the results. Margins go up, costs go down, new customers can buy the complete portfolio of ERB products - AND ERB can now sell the diabetes products to the thousands of existing and new customers in their markets PLUS the 95 countries and existing customers of the other ERB related companies.
If you were a ketchup co. and you bought a mustard co. you could immediately bring production of mustard into your existing facilities improving margins, slash all the old mustard co overhead (duplicative), sell mustard to all your existing ketchup customers, sell ketchup to the acquired mustard customers, PLUS sell mustard to the thousands of ketchup customers of your ERB partners all working together...
This is just one example and the future is bright. This why the stock is cheap and will get to a level reflecting what is going on. The fundamentals are too strong now for such a puny valuation. And shares are getting harder to come by. Once ERB trades at a level similar to comps it will be closer to $20. But not till the nervous holders have sold. Any day now IMO.
A quote relating to ERB from Charlie Munger, fits perfectly -
"Successful investing, Mr. Munger told me, requires “this crazy combination of gumption and patience, and then being ready to pounce when the opportunity presents itself, because in this world opportunities just don’t last very long.”… “It’s waiting that helps you as an investor, and a lot of people just can’t stand to wait,” he said…"
The post above is a new one from yet another firm - US Trade Media.
I have lost count of how many brand new reports on ERB there are. All bullish of buys, strong buys...
Add another new one today - Wall Street Scope. More favorable commentary. Put ERB on their Watch List this week.
So two new ones this week to add to the ten or so that have picked up ERB in the past 30 days. Still like the $20 price target by the Seeking Alpha Report. It explained the acquisition plan.
ERB is on its way and the selling is getting exhausted. From weak hands to strong ones every day. If ERB is trading above $10 in the next week or two how smart will the buying look then?
US-headquartered, Medical Instruments & Supplier ERBA Diagnostics Inc. (NYSEMKT:ERB) on Tuesday, September 9 was noted by analysts as perfectly positioned health care stock in the small-cap category. ERBA rated better recommendation by analysts despite smart expansion by peers such as Laboratory Crop of America Holdings into new business segments, such as Enlighten Health or advanced healthcare engines. ERBA is currently engaged in developing, manufacturing as well as marketing diagnostic test kits besides looking at instrumentation in autoimmune, diabetes, chemistry as well as hematology.
I don't believe the momentum guys will help the in the long run. The waY ERB has been moving higher on big volume is super for longer term investors. If you want ERB to get to $20 and STAY there. It is healthier if the momentum guys stay out.
With such a tiny float ERB is a target for the momentum guys. That is for sure. But all they would do is push ERB to $10 or $20 on huge volume as they get in. Then back down as they get out. Usually in a matter of a few days. Not great for long term holders. Maybe fun for traders.
Hopefully they will stay out. And ERB can slowly and deservedly rise to fair value. That is more sustainable. If the momentum guys come into ERB look out for a wild ride. Time will tell.
While this foolish person has been bashing ERB has:
Almost doubled their sales
Increased Earnings 400%
Got a new CEO
Revamped their sales team with a new head of sales
Made 2 acquisitions and integrated same
Increased their manufacturing by 100%
Increased their net margins
Increased their gross margins
Decreased their costs
Started an investor communications effort
Attended two investor conferences
Had their first conference call
Received as many as 10 research reports or buy recommendations
Seen the stock appreciate from $1.50 - $4
Maybe his sad but at times entertaining banter is good for ERB. But putting him on Ignore works too. Gotta love that "tough guy". Makes me laugh.
Every share that trades here is from someone who thinks ERB is high priced and or they are taking profits. All that is emotion. And emotion does drive stock prices in the SHORT term.
However in the LONG term ERB will trade where it belongs based on the fundamentals of the stock. From my 2 posts above you can see the ERB fundamentals are as strong as I have seen. And they are getting stronger.
If the upside in the shorter term is $20, and the downside is what $3? That means if you buy at $4 you are risking $1 to make $16. That is about as good as it gets.
I think based on a little emotion there is a little selling. Higher highs, lower lows. All the sellers are doing is giving a chance for buyers to get in and take advantage of this situation. Since the float is so tiny the selling IMO is almost done and I believe ERB is going to fly quickly much higher as there will be very little left to sell.
Then maybe at $8 the people that bought at $4 will be inclined to sell some? Human nature. Especially if it happens in a matter of days or weeks.
But that too is OK. All part of the process of ERB coming out party. Eventually ERB will get to fair value and this journey will have all been just noise. For those who took advantage it will be a fun ride. What is it they say? You haven't seen nothing yet.
If you look at my last post it is all just a summary of the past various ERB announcements. Earnings releases, conference call, research reports, quarterly and annual filings, trade shows, investor conferences...
You can simply look at the ERB news and read or listen to the conf call to find all that. But you have to read or listen to connect the dots. Obviously some people are starting to pay attention and do just that.
ERB should not be a penny stock. That is a temporary phenomenon changing before your eyes.
It has already transformed into a formidable company today. With an ambitious and exciting future tomorrow. All laid out by ERB in the news and various places for investors to see. Now ERB is making those efforts to better help investors understand.
That is why so many research firms are coming out with buy recommendations and why buyers of ERB stock are outnumbering sellers resulting in new highs almost daily.