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Quantum Corporation Message Board

hageneriksson 503 posts  |  Last Activity: 11 hours ago Member since: Oct 13, 2009
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  • First lesson:

    "cheap" shares are actually cheap for reason - in case of JAKK there are in fact plenty of them:

    (1) incapable management which has worked pretty hard rebuffing the financial community
    (2) a volatile business environment dependent on the success of licensed stuff
    (3) severe margin pressures mostly caused by
    (4) increasing competition
    (5) current revenue outperformance mostly caused by a one time windfall profit
    (6) an uncertain outlook going into 2015 as the Frozen tailwind will be mostly gone then

    Actually these kind of "cheap" shares are only getting even cheaper over time once investors realize that they aren't cheap at all. Current analyst FY15 estimates are still giving management the benefit of the doubt and model for flat revenues and earnings but this looks ill-fated given the current frozen tailwinds. If they have to take down either revenue or margin expectations in the future the shares will be absolutely doomed.

    And be informed that current management will never recede voluntarily and agree to any kind of takeover approach as they won't give away their very personal ATM. Actually no one in the outside world would ever give this idiots a job again.

    So clearly the shares remain uninvestable here - I would still view this as a good short idea going forward as management already stretched things pretty far when guiding for another revenue increase in 2015 and 30% margins next quarter which both do not look realistic here. I will be back next quarter for another funny conference call.

  • Reply to

    this stock is destroyed by the Shorts

    by tvhomer88 Oct 24, 2014 12:06 PM
    hageneriksson hageneriksson Oct 24, 2014 2:07 PM Flag

    There's no need to cover - management has set very ambitious goals for 2015 and again promised the magic 30+% margin which might again rapidly backfire on them.

  • hageneriksson hageneriksson Oct 24, 2014 2:05 PM Flag

    (1) They increased sales almost solely due to the Frozen windfall
    (2) Margins DECREASED unexpectedly and were in fact a far cry from what management promised a few months ago

    While I don't get why anyone still considers the shares a good investment, it is ok with me. But stay with truth please.

  • Reply to

    this stock is destroyed by the Shorts

    by tvhomer88 Oct 24, 2014 12:06 PM
    hageneriksson hageneriksson Oct 24, 2014 1:22 PM Flag

    actually they missed income projections by a mile and initially tried to conceal this

  • Reply to

    this stock is destroyed by the Shorts

    by tvhomer88 Oct 24, 2014 12:06 PM
    hageneriksson hageneriksson Oct 24, 2014 1:20 PM Flag

    The stock price has been destroyed by management not delivering on its promises and rebuffing the financial community instead. Shortsellers don't short shares randomly - they just pick the companies which give plenty of reason to expect that their share prices will move lower.

  • Reply to

    Capitulation at it finest

    by jrkkek Oct 24, 2014 1:06 PM
    hageneriksson hageneriksson Oct 24, 2014 1:17 PM Flag

    Apart from a dead cat bounce - where's the opportunity ? Management already guided for huge upside in Q4 and an even better 2015 but actually analysts and investors do not believe them anymore as management's ability to accurately forecast the business has been pretty underwhelming for many quarters now. The company faces severe margin issues, increased competition, decreasing Frozen windfall profits and a shame of a management . Should they miss their own projections once again (margins need to be at least 30%) the shares will easily make new lows.

    Betting on a takeover ? Not with current management.

  • hageneriksson hageneriksson Oct 24, 2014 10:06 AM Flag

    actually he trades VERY successfully as evidenced again yesterday and dozens of other times.

  • Reply to

    B. Riley cut JAKK to neutral. Reason is unknown

    by ksu_50 Oct 24, 2014 8:40 AM
    hageneriksson hageneriksson Oct 24, 2014 10:02 AM Flag

    actually the downgrade was because the huge earnings miss they initially tried to conceal by including a $6 mln one time item.

    but on the other hand Needham is pounding the table here:

    Needham recommends using the post-earnings pullback in shares of JAKKS Pacific as a buying opportunity. The firm believes JAKKS is better positioned for the holiday season than it has been in many years. It keeps a Strong Buy rating on the stock with a $10 price target.

  • Reply to

    takeaways from the CC

    by cragi Oct 24, 2014 1:45 AM
    hageneriksson hageneriksson Oct 24, 2014 9:59 AM Flag

    My takeaway is that management can't be trusted and really has no clue about anyting - they are just lucky to have the huge frozen windfall profits this time otherwise the shares would have been down 60% yesterday. And even Frozen comes at a prize as they have to pay penalties on cannibalized product lines.

  • hageneriksson hageneriksson Oct 24, 2014 9:50 AM Flag

    He's just wrong in this case (like in many others, too). The stock will be sold by him shortly as he has to cut his losses.

  • Reply to

    And the upgrades begin...with BofA/Merrill

    by newelectricfan Oct 24, 2014 7:35 AM
    hageneriksson hageneriksson Oct 24, 2014 9:45 AM Flag

    bad idea - covered for a loss

  • Reply to

    And the upgrades begin...with BofA/Merrill

    by newelectricfan Oct 24, 2014 7:35 AM
    hageneriksson hageneriksson Oct 24, 2014 9:39 AM Flag

    changed plans - sold out for breakeven and shorted because of expectations of a weak trading pattern today

    will cover the short and go long again at session end

  • Reply to

    And the upgrades begin...with BofA/Merrill

    by newelectricfan Oct 24, 2014 7:35 AM
    hageneriksson hageneriksson Oct 24, 2014 8:56 AM Flag

    had hoped for some upgrades and a huge short squeeze which clearly won't happen now - but I will hold on to the shares anyway.

  • Reply to

    And the upgrades begin...with BofA/Merrill

    by newelectricfan Oct 24, 2014 7:35 AM
    hageneriksson hageneriksson Oct 24, 2014 8:08 AM Flag

    disappointing though - only ONE upgrade to neutral is far below my expectations for today

  • hageneriksson hageneriksson Oct 24, 2014 8:05 AM Flag

    I really wouldn't want to own shares of a company with that kind of management.

    They intentionally concealed a huge miss in the earnings press release and made it appear like a big beat.

    They are virtually incapable to answer even the most simple analyst questions.

    They have been promising margin improvements for several quarters now just to make things even worse each quarter.

    They are promising improvements again and at the same time talk about new competitive pricing pressures.

    They are happy about the Frozen windfall and on the other hand have to pay penalties because of the cannibalization of other Disney products which fail to make their agreed minimum revenue contributions.

    After the huge sell off some investors are now hoping for a takeover - the company has turned down approaches in the past (when the company was on much more solid footing) as I guess current management is anxious to never get a job anywhere else.

    It is hard to imagine that things will be better in 2015 (actually I suspect them to be much worse) so I don't see why anyone should reach out for the company at this point just because the price is down 12% and a one time Frozen windfall is masking the severe problems of the company.

  • Reply to

    Just listened to the CC

    by aeishh Oct 23, 2014 3:26 PM
    hageneriksson hageneriksson Oct 23, 2014 6:26 PM Flag

    Management has been promising margin improvements for several quarters now just to deliver even worse results form quarter to quarter. Clearly investors and analysts don't buy this story anymore.

    Including the extraordinary gain in the reported eps number within the pr is just inexcusable as investors and analysts were intentionally mislead. Bad move but initially successful with the shares up 20% in pre-market.

    CEO and CFO refused to clarify reported numbers and actually made things even worse by rebuffing analysts. This is the second time in a row this has happened on the conference call.

    Clearly investors and analysts are worried about next year with most of the current Frozen hype gone then. Even slight revenue and earnings growth would be pretty difficult to achieve given the ongoing problems the company is facing.

    Management cited increased competition as another reason for margin pressures. No investor wants to hear about even more problems.

    These are the main reasons the shares have reversed course today and won't go up much going into next quarter's earnings release as investors fear more bad news going into 2015. With major earnings or revenue growth seemingly illusive the only reason for investors to stay with the shares might be an acquisition bet. The company has turned down such approaches in the past so I would doubt that this will happen anytime soon.

  • hageneriksson hageneriksson Oct 23, 2014 6:06 PM Flag

    Agree - except for the very poor service provider market results and ongoing weak product sales in general (the outperformance was mainly service related) - otherwise very solid execution and outlook although somewhat helped by the seasonally strong federal business. Revenue remains heavily concentrated in North America for now.

    The shares look VERY cheap here trading at below $250 mln enterprise value (using today's closing price) and $4 in cash with no debt. This looks like one of the best deals in today's market especially when looking at the renewed revenue growth.

    If the company will be able to exceed expectations again by a wide margin next quarter (which seems a real possibility) the stock might be easily double from here.

    I am willing to take the bet here and bought 25k shares just below $13.50 in after hours. Hoping for some upgrades tomorrow or next week.

  • Reply to

    I am speechless

    by tvhomer88 Oct 23, 2014 10:53 AM
    hageneriksson hageneriksson Oct 23, 2014 1:59 PM Flag

    that's not bad - but they upped the revenue guidance range by almost $100 mln and and all they get out of this great demand (mainly Frozen) is $8 mln more EBITDA - that's why analysts and investors were scratching their heads - and the implications of the revenue and margin issues for 2015 once the current Frozen tailwinds are history

  • Reply to

    Just shorts, this is a buy

    by fiberbull Oct 23, 2014 1:22 PM
    hageneriksson hageneriksson Oct 23, 2014 1:49 PM Flag

    sorry - I was on the call, too - and it went even worse than last time - why not giving out the 9-month-EBITDA number? Why did the CEO and the CFO not get the most simple analyst questions ?

    I have been on thousands of conference calls over the last 15 years and both the Q2 and the Q3 JAKK calls made in into my personal Top 20 of the worst conference calls of all time. So much for that.

  • hageneriksson hageneriksson Oct 23, 2014 1:43 PM Flag

    Nonsense - as a daytrader I shorted 10k shares in pre-market after discovering the margin issues and covered them sometimes later for a great gain. I reshorted 20k shares after the stock didn't manage to reclaim the $8 level and will close out the position at the end of the day regardless what happens.

    So my turnover will be at least 60k shares - I know about a dozen fellow daytraders who also were active in the shares today and there will be many many more. So most of todays' shares will actually have changed hands several times intraday at session end.

    Finally stop the always the same conspiracy nonsense and accept reality. Earnings looked decent but in fact were of poor quality. Guidance looked even better but management screwed things up on the conference call. Traders are pouring in for some scalp gains while disappointed investors are heading for the exit.

    Some contrary guys might be buying today in hope for a takeover which won't happen anytime soon. Perhaps some activist investor might show up over time but today there's no one showing up so far.

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