...should be accretive to earnings in 2016. They said they paid 1.4 times book, which seem real cheap for a buyout, and they paid about ten times earnings. But they believe that their are great synergies, and they expect to be able to dramatically lower Interboro's costs.
Looks like a good deal, although UIHC was cheap enuf that I'd have preferred no acquisition. Still....was a pretty good one.
And they also said that while they used a good chunk of cash, they do not expect to raise any cash by way of a stock offering the short to midterm. They said that they believe their stock price is very undervalued and would certainly not do an offering near current prices (with the exception if they found an unbelievable bargain company to purchase..but they dont believe that will happen.)
puesta...Darren, or any other CEO for that matter, should not be giving out any specific forward looking statements like that. And what would it even mean? The timeline, product, selling points are different. Other than general optimism, Darren should keep his mouth shut unless he's at a proper venue....like a special conference, a pr update for everyone to see, or an earnings call...........all imo.
well westy, since you think so much of me as an investor, you should be reading every word I write.
Oh...wait a minute..you do read every word I write.
...it is a summary of RCKY at the moment, so yeah sherlock...stuff has been mentioned here before. But certainly not all of it...particularly RCKY's new idea on how to get to 20% growth.
...continued from last post...
So, RCKY believes that over the next few years they can grow EPS by about 20%/year. They will do this using three methods to increase earnings.
1. Sales growth of low/mid single digit growth
2. Continued efforts to increase gross margins....I think they stated that they expect a 100 basis point increase per year. To me this sound difficult, on the other hand raw material costs should be dropping, so they have that going for them...of course when that changes, the wind turns in the other direction.
3. Their newest and most important new initiative. As I mentioned earlier, they don't feel their being represented well in some of their big accounts (like Tractor Supply). Many only sell a limited number of their sku's; and RCKY wants them to add more. Plus as I stated before, RCKY says some big chains are using some of their RCKY boots displayed at full price next to a similar house brand store boot at a much cheaper price.
So, they want to go to boldly into direct to consumer...selling more on the internet. This will raise revenues, since they basically double their revenue per boot they sell, and their margins are higher. The negatives of course are some retailers may not like competing against an internet brand. RCKY doesnt care b/c of the negatives I have already posted.
Anyways.....if they are successful, they should do real well. But I think it will, or at least should be costly to create enuf brand recognition so a vast number of consumers will go to the RCKY website to purchase shoes. We'll see if it works.
dont feel like writing about this anymore....best.
...continued from last post....
Every single initiative to enter new markets has been a flub. The shoes for health care & hospital workers seems to be a failure. The move into woman fashion with that awful fleur de sole brand (or whatever its called) has met no success....and they also stated that that their price point on those items was too high. They stated a year or so ago that their ad campaign to introduce their brands to younger man and woman was a flop. yada yada yada
Basically, they have a hard time growing any sales volume, and from their conference calls they seem to now expect maybe 5% growth on the revenue side going forward. Could be less. What was kinda shocking to me was the fact that they described one of their larger customers, Tractor Supply, highly touted just one year ago, as lowering their orders recently; and RCKY described Tractor Supply as basically using RCKY shoes on their displays to show what a bargain their house brand boots are. And they intimated that others were doing this. To me, that means that their prices may be too high relative to competitors.
And in the Riley conference they started naming new stores that they expect to grow their business with. Most of these guys were teeny chains...maybe some had only one store (or were in only one city). Seems to me like an awful way to grow your biz. They no longer brag about Shoe Carnival or Zappos or Tractor Supply....now its about Big Joe's Super Shoes of Pittsburgh (I made that name up).
CONTINUED IN MY NEXT POST
..I'm still not back in yet, much has to do with the fact I'm in other stocks right now, and don't want to add another big position. I mentioned when I sold RCKY near the open on earnings that I believed earnings estimates would come down near term.
RCKY is a strong value stock at these levels, and has lots of upside potential simply based on its pricing just five or ten percent above tangible book, and they do make a lot of money. Those are two very positive things, which alone could drive the share price back towards twenty.
The negative side is...well has anyone listened to the Riley Conference? I did, and based on that and their last earnings conf call; these guy simply have done one or two very important things extremely well, and a few things extremely poorly.
Their biggest positive...by far...is the absolutely amazing job they have done on the cost/expense and balance sheet side. Over the years they have driven down their long term debt as well as the interest rate they pay on it dramatically, probably their biggest savings of all by a good amount. They have also done well at cutting expenses, and their factory in the Dominican Republic, where a good portion of their product is made, has given them a cost advantage over other whose only option has been China with its increasing costs (obviously RCKY does a good part of their biz in China). Their move to get rid of their their hundreds of trucks selling direct to factories/workplaces, along with the many many associated distribution centers; and replacing them with kiosks where workers can order via the internet probably was the most obvious yet cost saving decision management made.....otherwise RCKY probably wouldnt be around.
Their worst moves have been basically every creative decision...(Continued in next post)
...and I was just adding some in the twelves a week or two ago. weeeeee....
algo, I responded to you right after you posted, but it seems to have disappeared. I guess b/c I gave a link in my post.
Anyways, I think you already listened, but the Riley conference is available on the RCKY website under investors.
And in answer to your question, I thought 'unfavorable feedback' meant that some of RCKY's competitors in the work boot biz have seen less than expected demand, and the sales pipelines are pretty full, leading Riley to conclude that RCKY is being similarly effected.
And, I accidentally left out a small but important part of the Riley downgrade summary (I couldn't cut and paste b/c the news appeared on my streamer). First of all the title of that summary was "Glut of work boots poised to hit Rocky Brands"; and where I wrote "unfavorable feedback from competitors" it actually should have read. "unfavorable feedback from some work-boot competitors."
OK, here is a summary of why B. Riley downgraded RCKY:
"Following B Riley's retail/consumer conference last week, the investment bank is downgrading footwear- and apparel company Rocky Brands (RCKY) to neutral following "unfavorable feedback" from competitors. B Riley is concerned 3Q reorders could miss and that it could take some time for retailers to work through excess inventory," potentially hitting 4Q reorders. And that as 4Q 2014 was strong for the metric. The bank cuts its price target to $19 from $25.."
by B. Riley, from Buy to Hold this morning...I dont have any of the particulars. I say its weird since RCKY has come down a bit on Friday, and RCKY just gave their presentation at Riley last Wednesday.
Not sure if this'll have an effect; but could present a nice Buy opportunity.
Right now I own no shares....so always interested opportunities.
Hey Hope....kinda like w/sgma, I got lucky Friday....saw the news on my streamer when it came out and was able to grab some at $6.05. Hopefully it'll react like SGMA and take off to seven bucks in a day or two.
...I see lots of posts similar to the recent 'RB3 is 135th in Video Games, and 19th in Video Games Xbox at Amazon.' Now....I cant recall if they are all Amazon rankings, could be Best Buy as well.
Anyway, it seems most on the board are very happy with these rankings and believe they presage strong orders. But for me, they don't really mean too much, since I really don't know what a good ranking would be and have nothing to compare it to.
So, could you, or anyone else, explain briefly why the product rankings that RB3 has attained at Amazon and any other outlets are expected to lead to strong orders?
Thanks in advance.....best.
contrats hopeful.....fantastic job playing SGMA. I was able to buy below $6 this morning, but also bought some at $6.08. I did sell out at higher prices last time...most on earnings day I think $7.25+, and a few more at higher prices before earnings.
Anyway, next quarter looks like it will be very strong. Maybe back over .20/share?
in the pr that next quarter will be stronger.
Made .16, trades below tangible book, and earnings and revenues are increasing.
Anyway, I bought back in this morning.
I was in Madison last week.....luv that town,well luv that town from May to September anyways.....ate a few times at Dotty Dumpling's Dowry......burgers are good, music is great...also grabbed a slice at Ian's.
imo, one of the most beautiful smaller cities in the US. Well, really just one of the most beautiful cities in the states.