Please see my press release from today, along with the related SEC 13D filing.
The release speaks for itself. I believe the 2 compansation committee members, Kenneth M. Scheriff and Jeffrey R. Franklin have, without question, have evidenced themselves to be corrupt figures, serving on P&F's board exclusively to "feather the nest" of CEO Richard Horowitz, as Horowitz licentiously, with moral larceny in his spirit, and a sense of contempt for the outside shareholder base, has taken out the lion's share of the increase in the company's value, over the last decade or more, for himself.
There is no justification for the pay that Horowitz continues to take out of this company, and the "revision" of his employment agreement, by Scheriff and Franklin, for 2014, reveals in spades, the form of perverse and diabolical "sway" that Horowitz has over a majority of the P&F board.
I intend to vote to WITHHOLD directors Scheriff, and Mitchell A. Solomon (a golfing buddy and close personal friend of Horowitz) at the upcoming annual meeting later this month. I also intend to vote AGAINST the approval of the executive pay.
What can i say? I like the stock. They are PROFITABLE going forward. They are not hemoragghing like a Radio Shack, or other truly "walking dead" outfits. They are highly likely to get a new student lender, and a bank covenant waiver (for what was a technical default anyway) in the near future.
i think the Street is crazy for selling this one down this much. The more real "risk" at this point is "reversion to the mean." Which could also trigger massive short covering. If they don't go bankrupt in the near term (which would seem a preposterous scenario), a major rally is pretty much "built in" now.
The pendulum has swung too far. It may swing farther, i suppose, in the very near term...but i'll keep buying, if it does.
Sentiment: Strong Buy
The $5.4 million is the adjusted operating loss, under the cult figure, Rouleau, in the 1st calendar quarter. The $6.1 and $5.2 million figures are the comparable Q1 loss figures under Mason, in 2012 and 2011, respectively.
What exactly, I DEMAND TO KNOW, has Rouleau done to improve this business, over the Mason Era? The stock is up roughly FOUR TIMES OVER now! For no reason.
Sentiment: Strong Sell
This was typed on May 12th, but it wouldn't "take" on Yahoo....and I never tried reposting it until now:
5.4 M adjusted operating loss.
Mason had $6.1, in the same 2012 quarter, and $5.2 operating loss, in 2011.
There has been NO MATERIAL IMPROVEMENT in the company's fortunes under Rouleau. This is especially true on the merchandising front, as the company has added efficiencies in distribution and freight, and reduced SG&A. Therefore, on an absolute gross margin (merchandising) basis, Rouleau has ABJECTLY FAILED.
Yet, perversely, the stock has TRIPLED, when Rouleau has NOTHING to show for himself.
This guy is a fraud...at least as far as his performance at TUES goes.
I fully expect Becker Drapkin to be dumping more shares in here. They'd be fools not to.
I plan on shorting.
Average cost of $1.58. (I was 10% of today's total volume.)
1) Cost cutting will stay ahead of revenue declines. Company remains cash flow and GAAP EPS positive.
2) Company finds lender to replace ASFG by June 30th. Lender buys all in house funded loans as well.
3) Company gets waiver from bank on technical default in the next week, before 10-Q is filed.
4) Company remains in compliance with ED, with NO requirement of posting letter of credit.
5) New initiatives turn around enrollments by the end of this calendar year.
5) Company maintains liquidity. Stock trades higher when investors see this is NOT a "pending Ch. 11."
KICKER: Sale or spin off of Heald could yield multi-bagger stock price increase (and MASSIVE short covering rally) similar to what happened with CECO, when it sold off its international ops.
Sentiment: Strong Buy
That's INSANE...all the more so considering we got a $5 or so book per share, net debt to equity is LOW, we are cash flow positive, and the company is guiding for material net profitability in the current quarter. Plus, Heald, in any normal M&A environment, should be worth at least THREE TIMES the current market cap.
This is not a Career education, whose underlying operations are HEMORAGGHING. Assuming we get a waiver from the bank, on the technical default, and get a new GAP lender in June, any and ALL perception of near to intermediate term liquidity risk here will go RIGHT OUT THE DOOR...and the shorts will be going in their pants, at that point. Such a situation could be a mere 4-6 weeks away! COVER NOW, you fools. Pigs get slaughtered!
the government basically decided to "punish" an insolent and defiant management, and is shutting the company down. There won't be any debtor in possession financing. shareholders are paying the price for a management that was engaging in fraudulent representations that pushed the government over the edge.
They are deciding to make an example of corinthian, to show everyone else they better shape up.
This, no doubt, strikes the terror of Jesus in the entire industry....especially the ESI's, CECO's, and education managements of the world.
I am happy to get out and salvage 30 cents, as i believe this will end up worthless in fairly short order.
Sentiment: Strong Sell
Modest position, that i'll keep increasing, on any further rally.
More to come, in terms of explaining my rationale, and the "phantom" turnaround at TUES.
I would be very surprised if we do not see more selling from Becker Drapkin.
Nonsense. I sold 2.6 million shares over two days. Salvaging the capital will almost certainly be the smart move. And the courageous one.
The government made a decision. They are not going to go back on it. They are going to make an example of corinthian....and "punish" and humiliate Massimino and Co. For defying them, and making a mockery out of their authority.
incompetence? How about "unduly coerced" by Horowitz, and since Scheriff has no manhood, and "knows" he serves on the P&F board at the pleasure of Richard, that he "rolled over," and caved in to his "master." That's not incompetence. That is corruption. And, in this case, it is in BROAD DAYLIGHT.
Scheriff is an utter coward, with no personal integrity whatsoever, as a fiduciary.
....is a canard. The notion that the "lumps and bumps" Rouleau referred to in the June quarter is a relection of something "wonderful"......when it is really code language for the fact that they have ADDITIONAL SIGNIFICANT clearance markdowns to take, bespeaks of a restructuring and repositioning that is not only "out of comtrol"....but is a failure.
The proof will be in the pudding in two very important outcomes. 1) Will they be able to show increased gross margins, and continually increasing same store sales, and 2) will they be able to continue to relocate store and show massive increases in sales at those stores.
I'm not convinced of either one, but most significantly, i'm not convinced they are going to be able to show any material gross margin increases. My own belief is that this business is going to be, at best, earning anywhere from 0-50 cents in annualized EPS.
Rouleau's and COB's mini block buy was to "play the street," and get them to "keep the fsith." I personally believe it was comtrived, and totally for show. More significant has been Becker drapkin's selling.
I'm waiting for higher prices to add to my short, but certainly will add, breaks into the $20's....and will "upgrade" it to a "strong sell"
that's not the most important issue. The most important is whether or not the stock is a screaming buy at 85 cents or not.
Do you want to make money, or do you want to play parlor games?
The very fact that it could come to this testifies to the height of his arrogance and stupidity and grandiosity. Why didn't he voluntarily leave the company months ago, in order to save it? Why didn't this stupid 11 member board know that It was getting to the final straw with ED.
Will the government, in the end, be able to prove fraud, and will Jack be criminally indicted?? One would feel better if such was the case. Otherwise, That he could get away with "mere" stupidity and arrogance would leave a sorry taste in one's mouth.
The fact of the matter is that he, and this stupid board, should have known the company was WAY out on a limb with ED.
Jack's statement referring to an "orderly transition of our operations" shows it is, indeed, over, and that ED has effectively decided to force COCO to close. Everything from this point onward will be on ITS terms.
Sentiment: Strong Sell
That's very mean and very uncalled for. He talks logic, and you respond with ad hominem attacks.
This is now my largest coal holding. I prefer it to ACI, now.
This is a spectacular intermediate to long term buy, imho. I agree with the Seeking Alpha article.
Buy it for the discount to book, and turnaround potential. Sell it for break even or better, a year or more from now, if things don't turn around.
This one is due for a major dead cat bounce....regardless of the near to intermediate term fundamentals. They have liquidity, so bankruptcy is NOT an issue for a good long while.
Sentiment: Strong Buy
...tthe fact that he effectively destroyed Corinthian Colleges, through the sin of pride and hubris, and put them into (pending) bankruptcy.
That an executive would not sense, and would not FEEL, that "the end was near," and that he was "twisting in the wind," is the ultimate in incompetence and arrogance. Jack basically sent the message to the government that "we don't have to do anything you want"...and the government said, al contrair, Mr. Massimino.
Jack Massimino gets the ultimate booby prize....for reckless incompetence...and willfull blindness...and asinine contemptuous defiance.
I'm not sure that's enough short shares to be material, either way....but i do like your notion that the fact that no insiders sold when we ran up to $6+ is bullish.
CECO's operating losses, as a percent of revenues, are an astonishing 20% or so, indicating a VERY sick business, that probably needs ANOTHER restructuring.
I would sell this stock, and put the money in COCO, which, while it doesn't have the cash position CECO does, has a much healthier business, that is running near break even, with positive cash flow....and announced another $125 million in annualized cost cuts.
You're just as sleazy as you indignantly accuse me of being. You talk up your book.
I reinitiated a short position, a few weeks back, and continue to add. If you read the last conference call transcript, it is pretty clear that the current quarter is going to have what Rouleau sedulously refers to as "lumps and bumps."
I believe the inside buying by him and the chairman are pulling the wool over the market's eyes, and are setting up for a major disappointment upon the next earnings release.
This stock is FULLY PRICED for any reqsonable prospects of a turnaround now. $1 in EPS is a 20% ROE, and I think it is doubtful they will achieve more than that, at best. Slap a 15-18 multiple on that and you got a $15-18 stock. Even if they do $1.50 in EPS, if you slap a 15 multiple on that, it's $22.50.
The EVIDENCE suggests that the additional sales volume is NOT coming through, with the repositioned merchandising. They are getting more traffic, but a LOWER average ticket. That means the lower initial markups are a double edged sword, and they are giving away margin, as they are getting nominallly more overall volume. The bulls will argue that the consumer needs time to "rediscover" the "new" TUES....and that is possible....but i would certainly say, as far as the Street is concerned, that with the stock in nosebleed territory now, it is do or die time for Christmas.