I held my position for 5 years and had added to it about 2 years ago. Greg Tunney is an excellent CEO, but I can tell you a decision to say "yes" or "no" should not take 3 months to determine if in shareholders' best interest and still no sign of any decision being made. They refused to discuss on conference call. I wonder if there is an acquisition in the works. There is much more here than meets the eye...that I am sure of. It will get interesting once the fireworks get started. I suspect they will turn down the offer which is the reason I sold. Stock will drop to $16 or less if that happens as business is clearly weakening. The only thing keeping the stock where it is...is the offer on the table.
It is pretty evident to me that Nick Caporella (who is age 77 and just happens to be the majority owner) is trying to sell the company. I doubt he is going to work forever...likely looking forward to finally retiring. I expect a sale of the Company in the next 12 months or sooner in the mid 20's, perhaps a little higher. He is trolling for buyers among Coke, Pepsi, Dr. Pepper, and perhaps others. Wait and see...maybe he'll give us a Christmas gift yet...My hope is that the sale occurs after end of Feb 2014 as I need long-term capital gain treatment. I am a relatively new shareholder on this train. The ride has been great so far.
I am not at all impressed with management for this business. Last quarter they talked about chassis procurement being the reason for poor performance and that it would be deferred to this quarter. Yes, sales came through for the 4th quarter, but profits are far from a blow-out and were about 1/2 of what they should have been.
Yes, paying down the debt and increase in backlog has been positive and gross margin improvements are encouraging, but what about earnings? Appears they are taking out bonuses for poor performance. The way things keep going there will be other one-time adjustments we don't know about like divestment charges, severance, incentives to enrich management, etc. I am sick and tired of all the excuses. What bothers me most is they aren't willing to answer the tough questions on the conference call. I don't trust management. I am unloading all of my shares and taking the profit I was able to realize. Good luck long....I may be wrong, but I think the stock is overvalued at current levels.
Yes, I agree this is not an exciting stock, but I believe the smart money is buying now and I am confident this Company is in the midst of a significant turnaround and has the right management for the job. It is one of my largest holdings. The Street just upgraded to a Buy yesterday on the improvement in same store sales - This is significant.improvement. Look at the balance sheet and how they have improved in last 10 years. They had over $538 million in debt in 2003 and today they are down to $173 million, plus bought back a significant amount of stock. In addition, the Company has bought back over 10% of the outstanding shares of stock since 2009 - over 14 million shares at a average cost of $5.21 - $70+ million! This has created value for the shareholders. I am quite confident that you will be able to say 5 years from now (Wait and see they will be paying a dividend by then because of the significant cash flow) you will be glad for buying at this bargain price. I recently ate at one of their franchised restaurants and the service and food were outstanding. Menu and service have definitely improved. I didn't take management's word for it....but witnessed it myself. The proof is in the numbers. This is a bargain at today's prices and eventually Wall Street will catch on....my numbers tell me this stock is headed north. It is only a matter of time. Be there.