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Bob Evans Farms, Inc. Message Board

golfer18us 207 posts  |  Last Activity: Nov 4, 2015 4:18 PM Member since: Jun 9, 2011
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  • golfer18us golfer18us Nov 4, 2015 4:18 PM Flag

    Agree that the EV/EBITDA multiple at 8.99 isn't "high" but I do have some concerns on their returns. ROA is only 4.2%. Panera is roughly triple that. Over time, hard to get excited about investing in a company with that low of a ROA even if they lever it up to jack up the ROE.

  • Reply to

    here are some problemos ...

    by ffighter71 Nov 3, 2015 2:31 PM
    golfer18us golfer18us Nov 4, 2015 4:11 PM Flag

    Unless the cash burn rate changes, they appear to be on pace to run out of funds in 2-3 quarters unless they miraculously convince someone to inject even more equity into the company. At this point, I can't imagine anyone doing.

  • Reply to

    COSI running out of cash soon

    by svenkarls1 Oct 12, 2015 7:12 PM
    golfer18us golfer18us Oct 27, 2015 5:04 PM Flag

    agreed....not sure how this survives past the March quarter in 2016. Burn rate gives them roughly 3 quarters from the Q ended June 2015. Not sure how they can possibly avoid Chapter 11.

  • golfer18us golfer18us Sep 15, 2015 2:57 PM Flag

    I can't explain why folks buy stocks that eventually go BK ...but they do...all the time. The financial facts shown on their cash flow statements are very concerning. When you look at the annual view on Yahoo finance, you'll find that for the fiscal years 2014, 13 and 12, they burned approximately $15.9 million, $9.1 million and $4.4 million respectively. This does not include the cash inflow from the sale of stock/rights...which won't be a tool they can use forever.

    When you look at the first 2 quarters of this year, they burned $7.2 million in Q1 and another $3.6 million in Q2...not counting stock sales (which are diluting everyone). The challenge is that financial engineering can't save this company forever and they have to find a way to drive net income from operations. Note that they've lost $4 MILLION per quarter for the past 4 quarters. It's actually unreal how consistent the quarterly losses at the net income line have been.

    They have a LONG way to go before they can get to breakeven at the operating income line and, even if they do, they have been spending roughly $2MM/year on capex. While they may not need all of that in the future, as long as they have company owned stores, they'll have to spend some capex just keeping the stores operating and relevant. I would never tell anyone not to buy something but I wouldn't use the college fund for this one. You're essentially buying a lottery ticket. Oh..one last thing...I wouldn't buy it based on speculation that someone will buy it. There isn't a concept out there that "needs" Cosi's footprint or operating platform and they don't own any of the real estate so there's no value there.

  • golfer18us golfer18us Sep 14, 2015 5:16 PM Flag

    Maybe it will work out for you. I'm not a "basher" and I'm neither long or short the stock. However, I have followed it for many years and it's never made money in the history of the company. The gross margins are anemic and when you ask yourself the question "what would have to be true for this to make money and be positive cashflow", there aren't any realistic answers in my opinion. They are so far away from breaking even at the gross profit level and then they'd need a bunch more to cover SG&A and Capex. My concern is that they don't have enough critical mass to get this turned around. Personally, I believe this will be a Chapter 11 filing within 12-18 months. I don't say that with any sense of satisfaction; it's merely based at a review of their quarterly filings and projecting things out.

  • Reply to

    RJ did a good job on the call

    by pechstein.carl Aug 13, 2015 5:34 PM
    golfer18us golfer18us Aug 25, 2015 9:37 AM Flag

    I'm not for, or against, RJ and Cosi however the numbers paint a very troubling picture. With gross margins in the negative, or slightly positive, territory, it's hard to see how this company can continue to operate and do the remodels they're talking about. They would need a significant boost in same-store sales at a very high flow-through to get this to be cash neutral. Maybe he'll do it but I think the odds are against him.

  • Before looking at the SEC filings for the Q, I read the transcript of RJ's call. Boy, was he doing his best cheerleading job and I was thinking "hey, maybe he's making progress". Then, I looked at the filings and here's what the cold hard numbers say:

    * gross profit dollars were down versus same quarter last year and margin % was worse (note, you have to really compare the quarter to the same quarter prior year due to seasonality...comparing to the quarter ended March isn't the best way to view results).

    * operating losses were only lower versus June 2014 because they didn't have big lease termination costs hitting June 2015.

    * the "cash used" got worse by $2 million and they burned another $7 million in the quarter

    Maybe he can turn it around...I don't know. But, I do know the quarterly numbers looked much worse than what you'd expect after listening to that call.

  • Reply to

    Get "The Profit" guy

    by suitcase8858 Jul 13, 2015 4:20 PM
    golfer18us golfer18us Jul 29, 2015 6:08 PM Flag

    You might want to wait until you see the quarterly numbers before you commit any of your hard earned money to this. They've never made money and certainly won't next quarter. This is going to be a slowly melting ice cube and likely to run out of cash in the next 12 months unless they find some other source of funding.

    Sentiment: Strong Sell

  • Reply to

    another $4-$5 million quarterly loss is coming..

    by svenkarls1 Jul 25, 2015 12:47 PM
    golfer18us golfer18us Jul 28, 2015 9:05 AM Flag

    agreed....at the end of the last fiscal year, they had $52 million in remaining lease obligations and all the debt comes due in 2017 I believe. They'll burn probably half the cash they had on the books at the end of the March quarter. I don't see how they get through the next 12 months without filing.

  • Reply to

    Positive cash flows in September quarter

    by ls99ls Jun 28, 2015 7:34 AM
    golfer18us golfer18us Jul 9, 2015 9:58 AM Flag

    Highly unlikely given the sales trends and the poor margins they've had. They've consistently lost $4MM and, depending on what they do to manage working capital, that has translated into a bunch of cash being burned.

    While I don't like saying this, I suspect this will be filing for Chapter 11 protection at the end of this year unless they have another injection of financing. They have $13MM in cash now and, at recent burn rates, that won't last much longer. Maybe his efforts to turn around sales will kick in but a lot of positive things would have to happen on the cost side for those incremental sales to turn this cash positive. Time will tell.

  • Reply to

    Making money

    by rtycrris Apr 16, 2015 3:29 PM
    golfer18us golfer18us Jun 3, 2015 4:54 PM Flag

    Looks like you were wrong.

  • Reply to

    Dead money

    by golfer18us May 26, 2015 4:04 PM
    golfer18us golfer18us Jun 3, 2015 4:49 PM Flag

    Thanks. When folks revert to name calling, bullying, etc, they clearly have run out of logical responses to make and respond as if they're in 3rd grade. I see no fundamentals that would give a true investor a reason to make a long term investment in this equity.

  • Reply to

    Dead money

    by golfer18us May 26, 2015 4:04 PM
    golfer18us golfer18us Jun 2, 2015 11:31 AM Flag

    Wow. I don't understand why folks have to resort to calling people names, etc when a poster has an opinion they may not agree with. To answer your question, I'm here because I see people post positive comments about this stock that are not supported by facts...that's all.

  • golfer18us by golfer18us May 26, 2015 4:04 PM Flag

    I've read the Zack's article indicating upside here but they keep burning cash at the operating level and the Feds are all over this industry. This could easily go the way of COCO. I realize some folks think they'll solve the problems by selling segments of their business but potential news is already priced into the stock. If you're going to speculate (which is what a new investment in this would be), isn't there something out there with a higher probability of success? This has been dead money for a very long time ....just look at the share price history.

  • golfer18us by golfer18us May 26, 2015 3:54 PM Flag

    It's been 5+ months and we're still without a CEO. Of course, it didn't help that the search may have started over the holidays but it still seems like they're having a tough time finding someone comfortable enough with either the controlling group or the company's prospects.

  • Reply to

    Daninfw: the latest on the M&A activity?

    by shorthighcoverlower May 20, 2015 10:31 PM
    golfer18us golfer18us May 26, 2015 3:47 PM Flag

    Finally....someone who understands that monetizing the owned real estate isn't 100% additive to the value! Good post.

  • Reply to

    BOD's

    by daninfw04 Apr 22, 2015 9:48 AM
    golfer18us golfer18us May 20, 2015 5:10 PM Flag

    Given their equity holdings, BODs will do just fine if they do whatever it takes to get stock price up versus trying to hold onto their annual retainer.

  • Reply to

    Buyout speculation

    by golfer18us May 20, 2015 9:52 AM
    golfer18us golfer18us May 20, 2015 5:07 PM Flag

    I don't disagree but I'd be surprised if it's at $14...that would be a huge premium versus trailing 3 month average (almost 50%?). Maybe in the right hands there's that much value to unlock. I don't have a dog in this fight one way or the other. Merely speculating based on publicly reported figures.

  • golfer18us golfer18us May 20, 2015 5:05 PM Flag

    again...there is NO buyout offer at this time. Merely rumors of interested PE firms. Nothing official.

  • Reply to

    Buyout speculation

    by golfer18us May 20, 2015 9:52 AM
    golfer18us golfer18us May 20, 2015 2:07 PM Flag

    141 of the 226 owned sites are collateral for Sr. Secured so not sure how those would be monetized. Plus, I'm not convinced there's much value in the owned real estate. If they did a sale leaseback, they'd generate proceeds obviously but they'd then be hit with rent expense which would lower EBITDA. In other words, it's not all upside.

BOBE
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