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jsoheerno 14 posts  |  Last Activity: Oct 2, 2014 2:48 PM Member since: Mar 14, 2007
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  • jsoheerno jsoheerno Oct 2, 2014 2:48 PM Flag

    LOL - Restatements never turn out positive. And the longer we go without the financials, the more likely it is they are going to be worse than originally expected.

    Sentiment: Strong Sell

  • Reply to

    Stock buyback

    by jsoheerno Aug 26, 2014 4:08 PM
    jsoheerno jsoheerno Aug 27, 2014 10:24 AM Flag

    So, let me get this straight. You are saying the the company that ignores accounting rules and has to restate for the previous 3 years is strictly adhereing to securities laws?

    I guess this just boils down to whether you assume management knows and plays by the rules. I am more sceptical based on recent events.

  • jsoheerno by jsoheerno Aug 26, 2014 4:08 PM Flag

    When the stock is suffering and there are inexplicable spikes just before the market's close, know that it is HTZ that is behind it. They are spending their stock buyback funds and burning through them quickly - hoping that, if enough time passes, it may discourage the shorts and push them to seeking opportunity elsewhere.

    The reality is, they are quickly running out of ammo and this puppy will tank very soon. Better to keep the cash and pay down your company's enormous debt!

    Sentiment: Strong Sell

  • Why short HTZ?
    1. lots of hype (most without merit), and thus way overpriced
    2. highly competitive market with low margins; all new start ups they are competing with are taking away market share and reducing the margins even further.
    3. market is at all time high and will correct in September
    4. HTZ is at its all time high despite numerous, material problems (see points below)
    5. Huge debt load that is growing by the day
    6. Inept mgmt team that is botching its integration with Dollar, which will lead to increased spending and will deteriorate margins
    7. Significant financial issues will be reported in restatement, lowering revenues, profits, guidance and debt loads going back three years
    8. Any mgmt changes brought about by Icahn will take years to result in any positive developments. The problems are not overnight fixes.
    9. Ichan will prove a distraction to mgmt and will actually impede progress of any turnaround. Why? Because management change only leads to management change of other executives. Those new leaders will take time to come in and assess the damage, and will have no qualms lowering the boards expectations and blaming it on the previous leadership team.
    10. Downgrades and lower guidance will become the new trend as more information about the company's problems becomes known. Each one will be yet another blow to any bottom that appeared to be forming.
    11. Icahn will likely reduce his stake and not attempt to take control of the company as it becomes obvious that there are better targets out there that will be a faster, easier fix, and will offer more growth potential.

    In summary: many major headwinds will make it impossible for this company to stay on course. As the direction changes, it will become a "jump ship" stock, leading to a drop back into the low 20's or even high teens. My prediction is that we see those numbers before year end.

    Congrats HTZ for being the short of the year stock!

    Sentiment: Strong Sell

  • Rumor has it he is extremely frustrated at the extent of the accounting issues. Turns out HTZ won't be the quick fix he hoped it would.

    Carl - you still have time to sell with a gain. Better hurry though, the price is going to drop quickly.

    Sentiment: Strong Sell

  • Check flyonthewall / google for the full release

  • The recall alone wouldn't impact the financial restatements going back years. The fact that they have to be revised that far back means that they've been misreporting all along. Nothing is as good as it appears with HTZ. They've taken on more than they can chew and are doing a terrible job of running the company. Holding back two quarters of financial information means it this is going to be a blood bath.

    If a good management team comes in, there is hope, but it will take at least 12-18 months to put in place and understand the real issues. They will then put a strategic plan in place, which will work extremely hard at simply getting them close to the numbers they've been reporting for years. No board shake up is going to turn around the stock anytime quickly. The real result of the new management team will be to manage the board and shareholders expectations: that revenues and profits will be strained for the foreseeable future.

    The fact is HTZ is one the best examples out there in which shareholders expectations are completely out of whack with reality. All the commentary and positive sentiment on the company that have flowed in over the last 12 months should be viewed as suspect in light of the restatement. This is about more than just the GM recalls. Revenue is one of the simplest things to book correctly. This indicates that management has been pulling too many tricks in trying to make the financials look better than they were. After doing that for so long, there comes a time of reckoning.

    If you like the company, wait at least 6 months - then buy when it reaches its bottom.

  • jsoheerno by jsoheerno Aug 21, 2014 3:44 PM Flag

    For anyone that thinks the CEO change is going to fix this broken company, you may want to check yourself into a mental institution. The problems are not leadership problems. They were caused by leadership problems, but will only be fixed over time after spending lots of cash and wasting lots of internal hours. Shareholders will suffer over the next 12-18 months as new leadership comes in and unearths all the skeletons in the closet. It will be at least 1 month before a new CEO, at least 4 months after that before he/she has any sense on the true scope of the problems, and at least 12 months after that before anything is really fixed and back on track. In the meantime, the share price will continue to erode. And during that period, we will likely see the big correction everyone has been fearing. My $17.50 estimate for October is conservative.

    Sentiment: Sell

  • The only problem is, they are burning through their $1B buyback very quickly. It will tank shortly.

    Sentiment: Sell

  • Reply to

    We'll close below $29

    by jsoheerno Aug 21, 2014 1:00 PM
    jsoheerno jsoheerno Aug 21, 2014 1:04 PM Flag

    Most importantly, though, board changes and the resulting management shakeups take lots of time to result in positive change in the numbers, as do restating financials. HTZ can only trade down for the next 6 months.

  • jsoheerno by jsoheerno Aug 21, 2014 1:00 PM Flag

    The idea that Icahn can come in and turn this around is not rational. His presence can move companies in which a simple management fix will turn things around, but with HTZ, there are substantive issues in the business, the shareholders are fundamentally misinformed and due for a shock, and the performance of the business is far below expectations.
    Close below $29, $27 by Monday. And my guess is that we bottom somehwere around $19, depending on the extent of the issues.

    Sentiment: Sell

  • Now that earnings are out, it is stocks like GPRO that will be the first to suffer. Wait for the low 30's and re-enter.

  • Reply to

    We go below $40 tomorrow

    by jsoheerno Jul 31, 2014 6:16 PM
    jsoheerno jsoheerno Jul 31, 2014 6:20 PM Flag

    that is implied. and as much as i hate to say it, we could see the high 20's in the next few weeks.

  • The pressure of the overall market is going to bring GPRO back to earth. Why hold this stock now? Let the selling abate then load up at the new low if you do want to go long. The only problem is, there will be bad headwinds from the market overall. My vote: sell, then wait for 30's to re-enter.

    Sentiment: Sell

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