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International Business Machines Corporation Message Board

jpmarketer 167 posts  |  Last Activity: 4 hours ago Member since: Jan 16, 2008
  • Here is a post from Silly Sally 2938 on March 5, 2014, pumping RVLT. He purports to have inside information that the stock price will rise. At the time of the post, RVLT was in the low 3's, and with days, this poster Sal and his buddies pumped it to 4. It has slowly slid back now to the low/mid 2's.

    Those are just facts. Look at this post, go back and see it before Sal erases it (will be gone within minutes, like all of them are), and then look at the chart for RVLT and the dates I'm telling you.

    Just got an email from an old friend.
    sillysally2938 by sillysally2938 • Mar 5, 2014 11:13 AM Flag
    Said she thinks RVLT's about to ride much higher. eom
    Sentiment: Strong Buy

  • Reply to

    Covered 51.70 pre-market

    by jpmarketer Jul 3, 2014 8:40 AM
    jpmarketer jpmarketer Jul 7, 2014 9:03 PM Flag

    Please tell us the margins for Lighting, interclay. What were they FY 2013, versus the company average, versus LED?

    Also, please tell us the growth rate for CREE's lighting business versus that of LED.

    Let's get into a discussion of the numbers, if you would like. There are only a few key ones, and they tell a very powerful story. Just go to the recent 10Q and tell us.

    If you won't, why? Where is Silly Sally? Why won't he answer the earlier question about the mix shift from LED to Lighting, and the continued erosion of net operating profit? Is that an embellishment for effect, you think? LOOK AT THE NUMBERS:

    growth rate for Lighting
    margins for LIghting

    Growth rate for LED
    margins for LED

    WITH 3 OF 4 QUARTERS FOR FISCAL 2014 IN THE BAG.

    I supposed the entire investment community is also spewing "rubbish" when CREE dropped from 70 to 45 upon this same report? Just let's hear the numbers, and then people can make their own decision.

    That isn't me, it's the Company's 10Q. Read it and tell us about LED's 3% growth (with high 40's% gross margin) vs. Lighting's 38% growth with only 27% margins (versus Company average 38.7%), and dropping like a stone.

    Oops, I did it again. Some of your homework.

    Interclay, I understand your fear of the facts I'm posting if you're long. I'm sorry for you and others who have been herded into another high beta, volatile story stock that is manipulated, runs hard, and is managed by a few communicators -- one in particular who has developed a perverted sense of entitlement to sheep proceeds.

    Look at the numbers so we can have an honest discussion of CREE's opportunities and threats - not the rubbish you're being fed by the likes of idiots such as the silly board clown.

  • jpmarketer jpmarketer Jul 7, 2014 4:31 PM Flag

    I agree with you. Philips has an overwhelming presence in terms of number of SKU's and amount of product on shelf. But their packaging, imo is far inferior to CREE's, the assortment is a mess (and with that number of boxes, everything out of order), whereas CREE's shelf is linear, its 12 SKU's, 2 color temp choices in each wattage, simple. I agree. In the Trade, we call it product rationalization. Cree's is elegant, as is their packaging and design. I don't like the margin mix shift and hope Silly Sally will soon come back to tell his thoughts on the Strategic Plan for LED, how it will close the margin gap being created by Lighting to continue growing earnings consistent with today's multiple. But I've always said CREE's packaging and design are really top notch, I believe very tasteful and communicative.

  • Below, I posted several concerns about the Strat Plan you have been speaking about.

    Specifically, I raised margin mix shift issues and how they are impacting operating profit.

    I have about a dozen posts I see from you inferring this, or that, about the Strat Plan, specifically about Lighting Fixtures driving the growth. Please help us understand the growth rate of that segment versus Lighting, the margins, and why the shifting mix shouldn't concern us in terms of the maintenance of Cree's multiple (the exact concern noted by the investment community upon the last report, which dropped the pps from 70 to 45). My basis of reference includes the summary tables in the 10Q, which I'm sure you are familiar with.

    Now, everyone is waiting....

    Thank you,
    -JPmarketer

  • CREE's net operating profit dropped from 15% in 2011 to 7% in 2013. This was driven primarily by 2 things:

    1. A drop in gross margin from 44% to 37.8%, and
    2. The ballooning if SG&A, primarily attributable, I believe, to the Commercial and Industrial Segments.

    Now peel back the layers on that gross margin. CREE's Lighting margins are low and dropping. But Lighting is becoming a larger part of CREE's mix. At the same time, LED commands margins in the high 40's, but is shrinking as a proportion of the mix.

    Check out the Q3 2014 Report, and look at the growth rate for LED in the 3 month period ending March 30 - 2014 compared to 2013. CREE's LED revenues grew only 3%, versus Lighting revenues that grew 38%. Now look at the margins for Lighting!

    THIS is what I think the Street saw with the April report. A mix shift toward lower margin Lighting that could unravel the financial infrastructure of the Company medium-term, and is absolutely impacting the multiple short term/now.

    Pokernstocks -- you said that gross profit dollars, not %, are all that matters. I disagree. That declining margin (driven by the mix shift), along with the heavy SG&A expenses required in the ultra competitive on-premise segments (Commercial, Residential, Industrial, etc -- non consumer) -- are driving operating profit south of 7% - HALVED in 24 months. This affects EVERY key financial performance metric, like ROACE (Return on average Capital Employed), ROE (Return on Equity), and so on. Why does that matter? Because assessments of risk, cost of capital, so many things are predicated upon the RETURN on the investment in CREE, and the RETURN is shrinking, even as the gross profit dollars grow.

    One more thing - Silly Sally is clear that Lighting Fixtures will drive the growth, per the Strat plan he knows so well. What was the growth for Fixtures this year, versus Lighting -- the margins, same exercise as above?

    It's a problem -- they are off track with the strat plan

  • Reply to

    What the Lighting Wars Are

    by jpmarketer Jul 4, 2014 6:06 PM
    jpmarketer jpmarketer Jul 5, 2014 4:55 PM Flag

    Thanks. The first thumbs up on your post is mine.

    I want to read the transcript first in its entirety, which I'll do in the next few days.

    CREE needs much stronger creative and introductory/sustaining media weights than what I saw in the New York market over the course of a few weeks, a few months ago. If they can make themselves synonomous with LED lighting, like for example, Kleenex is to tissues, or Drano is to drain opener, they can rise above the commoditization, even at higher price points. Fact is, I believe they have the technology and design differentiation to stand out from the competition in ways that are meaningful and relevant to consumers (and gorgeous packaging).

    But if they blend in -- with mediocre advertising at blah weights, and with an in-store presence that is dwarfed by Philips and lost on shelf, then they will be sucked into the commodity war and there is no escape.

    They HAVE the opportunity to differentiate their technology and design, and to smartly leverage their commercial biz against consumer (as you referenced in your quote, and as CREEman referenced in his "Business plan post" a few posts ago).

    THIS is the MOST relevant conversation for CREE right now, imo. They've got a bang-up product, national distribution, and unique, meaningful differentiation in a category that is moving from early adopter trial to mass adoption - what the longs here see and why they're invested. But now CREE have to STAND for something.

    Volvo wasn't just a car. It was the SAFE car
    People often don't ask for a tissue. They ask for a Kleenex, no matter what brand it is.
    How about Frank Purdue's branding of chicken, when it was the definition of what commodity is

    Marketing created all of this. Marketing and Technlogy working together, capturing the imagination of the trade and consumers.

    I'm concerned that their senior management doesn't get this, with the installation of sales heads with no consumer experience. I'll read the report. Thanks

  • Philips spins off their lighting unit.

    CREE average gross margin is dropping as their mix shifts away from components toward lightning.

    LSGC is traded OTC, now at .37/share and tetering (and how funny that the silly sally/jimbobob dolt is over there potty mouthing posters the same as he does here).

    What you've got here is a sh-t storm developing, and branded manufacturers won't play in this sandbox. It's dynamic, volatile, exciting, high velocity, and OFFERS NO MARGINS.

    Philips can't have their portfolio dragged down by this, CREE's already is. I'm not too up on LSGC yet, but they don't look healthy at all.

    It's like the banks, during TARP. The thought was, create new banks to take on the ridiculously structured, deeply in-the-red mortgage-based assets. Don't drag down the nation's banking system with this losing proposition.

    That's what's going on in lighting. 4 or 5 majors, and a whole bunch of Asian players are setting up for a sh-t slog commodity war.

    I believe - my opinion - this will all come home to roost for CREE short term. Long-term, the volumes could create operating leverage that will overcome these factors. I see some analysts believe that too.

    But there is a sh-t slog coming short term. Being a story stock, new, exciting technology, great product design, exploding category (volume-wise), this stock (like ENOC was) is being pumped in a herding exercise like I've never seen before. It could continue next week or two.

    But then earnings may likely throw water on this like it did last quarter -- earnings, margins, outlook, commentary.

    ENOC just went through a similar cycle, with the aforementioned outcome. Another great company, great product/service, but got ahead of itself in multiple versus marketplace realities.

    May have been too early on the short last week, But beware of the water splash at upcoming earnings. And if this has gotten pumped up much further, the drop will be precipitous. If I'm wrong, let it fly and G/L to Longs.

  • Reply to

    Home Depot: Glendale, NY VS. Garner, NC

    by jpmarketer Jul 4, 2014 10:55 AM
    jpmarketer jpmarketer Jul 4, 2014 5:45 PM Flag

    Thanks quantumwelldiver --

    Like I said previously, your one liners with no substance make you the CREE board sod. Please, tell us YOUR point of view on CREE marketing, category marketing or anything else. To date, you have not shown yourself capable of having one original thought. A board sod who, in complete anonymity, cuts and runs.

    In terms of Marketing and Merchandising at Home Depot, tell that to Trish Mueller and Gordon Erickson. Mueller in particular, is impressive. So is her track record at HD.

    But the thing is, most of the marketing at box stores is designed by the manufacturers themselves, and funded by the box store and manufacturer via co-op program dollars. To date, Lighting Category (not just CREE's) practices at retail are infantile.

    Hey sod, search online for the company Advantage Sales and Marketing. Go to the mass merchandiser tab and see how they partner with manufacturers to create big box marketing programs.

    Sod, in the Rumsfeldian sense, you don't know what you don't know. In fact, your newest, thoughtless one-liner is more laughable than Philips in-store merchandising (and packaging, where CREE is clearly superior).

  • Reply to

    Home Depot: Glendale, NY VS. Garner, NC

    by jpmarketer Jul 4, 2014 10:55 AM
    jpmarketer jpmarketer Jul 4, 2014 11:00 AM Flag

    The observations from Garner, and from Colorado Springs (if I remember right), I would think, are accurate if any # of SKU's up to the numbers above were observed. In Glendale, NY, CREE had 12 SKU's set up on shelf, not the 33 that are carried full system.

  • I've taken a look at the Lighting Department of the Glendale, NY store, and spent some time online in the Lighting Area of Home Depot's Web site. Even this preliminary look shows some striking things about the Category generally, and CREE, specifically.

    Raybans asked about the marketing of the LED segment, versus that CREE. I believe the Category's marketing is immature, and ineffective in terms of consumer packaged goods marketing best practices. Examples:

    Horrible product rationalization/shelf set optimization. Philips, with their overwhelming shelf space, is the worst offender. Disorganized, confused, no clear delineation between product segments (CFL vs halogen vs incandescent vs LED).

    One of the highest velocity items in the store (unit movement -- like motor oil quarts are to an autoparts store). This provides extremely rich in-store opportunities for merchandising, education, store clerk (associate) education, sales incentives, so many types of programs against the objectives of educating consumes, selling up to the new technology, higher margin categories, emphasizing brands that provide the greatest margin and/or overall profit contribution to the store's lighting dept. NONE of this is happening, that I can see in the few stores I've been to.

    I spoke with three associates this past Tuesday night -- two of them specifically in the lighting department. In the words of Cramer, they know nothing!!!!!!!!! It was laughable, and one of the most significant missed opportunities I've seen.

    Other observations --
    HD Web site -- lists the following for # of LED SKU's carried by HD by brand
    Philips - 146
    TCP - 97
    Ecosmart - 83
    CREE - 33
    GE - 26

    More to follow re advertising, packaging, private label threat

    These are system wide numbers. The actual number of SKU's in the stores is less.
    In Glendale, NY, there are 40 Philips LED SKU's on shelf to CREE's 12.
    In Glendale, NY, there is a "Bombillas" Display with 5 Ecosmart and 3 Philips bulbs. No CREE.

  • For a ST loss of about $560 including trading fees.
    Good luck to longs today on the upgrade.

  • Reply to

    CREE on Glassdoor

    by jpmarketer Jul 1, 2014 2:18 PM
    jpmarketer jpmarketer Jul 3, 2014 8:28 AM Flag

    Good Morning, "Silly Sally" -

    I'm here this morning, still short (never covered any of it), and maybe will take a bit of a bath on the upgrade.

    I wonder if this is as unfortunate for me, as when you bought (and encouraged others to buy) $25 calls for ENOC in March. You were laughed off the board.

    Or how about when you were pumping CREE at 70? Do you remember? Now it's at 51 something this morning.

    Win some, lose some. That's what happens to most retail investors, and if one can stay ahead longer term, that's the objective.

    No "faux trading" here, but how you feeling now that CREE is at 51 when you were encouraging everyone to pile in in the high 60's? And why do you disappear when things go south on you, like they did me, today?

    No, I'm here, and if I take a hit, I take a hit. Keep it real, buddy.

    PS - You have read every one of my posts, you sit there seething, and I understand your holdings (ENOC and CREE at least) are way down. As a long term investor in CREE, buying in the high 60's like you did, you will never recover.

    Me, I'm a trade or two away from making up this morning's loss, doesn't feel great, but that's the way it goes -- when one keeps it real.

  • Reply to

    CREE on Glassdoor

    by jpmarketer Jul 1, 2014 2:18 PM
    jpmarketer jpmarketer Jul 2, 2014 5:01 PM Flag

    Hey blackoutbuzz, I told the poster that the keywords he said did not bring up what he said. That was all. Pls see my post.

    I don't know that it's an "antiquated" brick and mortar sales model, but your point about researching this category before being in-store - particularly for early adopters in this category (my word, but your thought), is an excellent one. The last brand I managed was over ten years ago and the role of the internet, and dissemination of the brand story, were completely different.

    Please don't underestimate the role of in-store merchandising, promotion, category management, sales clerk education, signage, pricing, and so many other critical parts of the marketing mix. But yes, I'm probably understating the role of preliminary research in the LED Lighting purchase process in how I laid things out. Thanks.

  • Reply to

    CREE on Glassdoor

    by jpmarketer Jul 1, 2014 2:18 PM
    jpmarketer jpmarketer Jul 2, 2014 4:51 PM Flag

    Thank you for your comments today. I'm not referring to the focus, or how hard marketing and/or sales is pushed, or if they're lazy or not, in the absolute or versus manufacturing. I'm talking about a mind-set, a marketing-driven culture with bold trade tactics that carve out shelf space, more than fair share of merchandising and promotion, and all of the retail push tactics that complement a consumer advertising campaign that introduces the brand, educates, and draws clear lines of relevant differentiation so the Trade will stack it high, and consumers will come in asking. That's the equation you need to balance just right.

    I've examined Mr. Barlow's credentials. He has never done any of this.

    They're going to get their lunch eaten sales and distribution-wise in a category that is dynamic, volatile, and hasn't yet begun to consolidate. Not to mention another poster's astute observation about sales force morale, when the top guy has never done the job before. This is insane, and only one of the reasons I'm short.

  • Reply to

    CREE on Glassdoor

    by jpmarketer Jul 1, 2014 2:18 PM
    jpmarketer jpmarketer Jul 2, 2014 2:15 PM Flag

    what % of consumers do you believe make their brand selection before coming to the store, or even intend to buy light bulbs. What about the proportion that doesn't? Please don't look at your own practices. You are a data point of one.

  • Reply to

    CREE on Glassdoor

    by jpmarketer Jul 1, 2014 2:18 PM
    jpmarketer jpmarketer Jul 2, 2014 2:08 PM Flag

    Blackoutbuzz, I never indicated anyting about a difference in culture between the mfg folks and marketing sales. I believe the culture of the Compnay is technology-driven, not marketing/sales-driven, and this competency/orientation is critical to win in CREE's consumer packages goods marketplace.

    I believe the selection of the sales leaders -- and the characterization that one of them 'understands the needs of the lighting industry" comes from industry insiders who have as much consumer savvy as one who believes that discussion of shelf space and category management is that of a shill on a chatboard.

    You know what this company needs? A VP Sales who comes from Clorox, or General Mills. Then, with close collaboration between her/him, the Head of Marketing and Head of Technology - the winning formula emerges.

    I believe the company has made at least two fundamental leadership mistakes and that this represents a culture and skill set that is not perfectly aligned with the needs of the marketplace.

    In that sense, I have a negative bias, I think the company is going to suffer for it, I've seen this happen over and over and it's what I do for a living. it's why I'm short and I'm explaining my position, as I sit here working on my primary living, for the intellectual exchange -- not because I think people will read it and sell. Now THAT would be naïve and foolish, imo.

  • Reply to

    AYI( reports earnings

    by blackoutbuzz Jul 1, 2014 10:01 AM
    jpmarketer jpmarketer Jul 2, 2014 1:40 PM Flag

    Yes if they have similar usage applications and consumers.

  • Reply to

    CREE on Glassdoor

    by jpmarketer Jul 1, 2014 2:18 PM
    jpmarketer jpmarketer Jul 2, 2014 11:58 AM Flag

    "As for replacing the folks who headed up the sales efforts, this could be seen a positive sign that CREE is trying to expand sales beyond internet and HD."

    OK, thank you. We can agree to disagree.

    In terms of my observations, I believe I'm seeing a reduction in "push" for CREE products in NY. Another poster referenced real time inventory data. If he's correct, then all the stuff was in the back room, and not on shelf. There could be a lot of reasons for this, some not related to anything negative. I stand behind every single word I've written. I will go into the Glendale Queens store in the next few days, get an exact accounting of facings by brand, ask the store manager what's up and note the results here if any new info. I recognize the points you are making.

    In terms of your testing CREE products, I like them a lot, use them, have posted same many, many times.

    I worked in a European Organization for five years as Head of Marketing for a North American group of brands. We were premium priced, the best technology, and we fielded competitive superiority claims via great television advertising to build the brand and create the consumer "pull." At the same time, we marketed to the trade, creating programs, incentives, and such -- and selling them in aggressively -- sales and marketing standing together ---to carve out our place in the promotional schedule (store push), which is the critical piece most non-marketing people don't get.

    The Head of Sales managed the retail relationships with Brand programs I made for him (many account-specific), and THIS IS WHY I'M SAYING CREE DOESN'T GET IT WITH THE SALES GUYS. They are technology weenies (really good ones) but you have to market to consumers and the Trade in order to win, and they don't know how. They don't even understand the playing field, it looks like, and that's one reason I'm short now.

  • Reply to

    CREE on Glassdoor

    by jpmarketer Jul 1, 2014 2:18 PM
    jpmarketer jpmarketer Jul 2, 2014 10:27 AM Flag

    You know, I don't understand why more people aren't comfortable debating the legitimate strengths, weaknesses, threats and opportunities for a given company - regardless of their short term trading position.

    I truly don't think these message boards have an impact on the stock price. Especially not given the average daily volume for a stock like CREE.

  • Reply to

    CREE on Glassdoor

    by jpmarketer Jul 1, 2014 2:18 PM
    jpmarketer jpmarketer Jul 2, 2014 10:19 AM Flag

    That's just not true -- alluding to HD dropping CREE. Why would they? There is a place in their product portfolio -- the right combination of shelf space, pricing, merchandising execution, spread between the branded players and the private label to - again - maximize profit contribution from Lighting.

    Also, CREE is supporting the brand with advertising, although the recent flight was short and the media weights were way too low, at least in NY, to create lasting consumer impression). Point is, though, they've created a solid brand, they have great products, and there is a consumer following.

    All I said was that I and others observed reduced shelf space in 5 NY Metro stores. Significantly reduced shelf space with complete domination by Philips and Ecosmart.

    I'm wondering if HD is rationalizing their product mix - even by local market which they are sophisticated enough to do - to match consumer demand, again, to maximize department contribution. Such a reduction for CREE - WHICH I'VE OBSERVED IN NEW YORK - could be consistent with this reduced merchandising emphasis on the part of HOme Depot.

    THAT'S what I'm saying, not that I have any information, indication, or even opinion that Home Depot is dropping CREE.

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