One thing for certain is that MIDD is broadening and deepening the moat around its business. At the end of the day, this places a higher value on the company....whether it remains a stand alone company or chooses to sell out.
The Bakers are always working on deals...the one that at some point will involve SGEN will likely be a blockbuster based on their continued accumulation of shares and the large position they have in this stock. They are NOT buying to support the share price but, rather, to make a down payment on a huge payday.
Correct on the filing data. The question is, what is the Baker Bros's strategy: hold on for appreciation or orchestrate a buyout?
Looks to me like there's some great data in the pipeline (courtesy of some excellent blockbuster drug candidates). At the point at which value can be optimized, whether by market appreciation or by some large pharma stepping up with a bid to take out the company, the BB's will have scored another home run.
Judging by their position in this stock, relative to their other holdings, they must have supreme confidence in SGEN leadership to steer the company in the right direction.
This appears to be a new suit. The Feds saw the CT. state suit and thought: "why are we missing out on this action?" In all likelihood, this too will be resolved without any meaningful damage to the company....after all, this suit claims to be against the industry, not just LCI....so I cannot opine about if any of LCI's competitors are at risk.
I should point out that LCI has acknowledged the ability to hike prices as competitors drop out of the marketplace....nothing wrong there. Also, the company is relatively unique in that they are allowed to deal with so-called "controlled substances" and I would think they have been very careful in this area so as to avoid any undue criticism.
Aside from a very respectable EPS report Selim Bassoul (MIDD's CEO) on today's call reiterated what I took to be the best long-term driver for this company when he said that by 2020, half of all restaurant kitchen operations will be automated. The magnitude of this number and its impact on MIDD has to be staggering and reinforces the longer-term growth story as MIDD is the leader kitchen equipment supplier to the vast majority of larger QRS and casual restaurants. As minimum wages continue to escalate across the country, MIDD's value proposition gets stronger each day.
Note that MIDD included $6+ MM from a "gain on litigation settlement" in the report. In doing my analysis, I've opted to back this number out of their statement. After making this adjustment, I still get an excellent EPS beat of $.94 us an expected $.86.
I remain long and while $105 would be great to see today, I'd be happy to see the stock at $95 or thereabouts in the near term. MIDD remains a core holding in my portfolio. Be interesting to hear the company's comments on today's CC.
It's no surprise to me that, after a 50% up move in the last 3 weeks and a strong EPS report and strong guidance, we shouldn't have a 10-15% correction. This, too, shall pass....IMHO.
The company gave guidance with today's EPS report. Taking the worst and best cases (the lowest sales estimate, the lower gross margin, the highest R & D and SG&A, tax rate on one hand and the highest sales estimate, higher gross margin, lowest R & D, SG&A and tax rate on the other hand....and using 39 million shares, I get an EPS estimate range of between $2.96 and $3.50 for FY 2015 (June).
If the company has a decent handle on what they're doing, I think full year 2015 FY estimates will/should begin to scale up to at least $3.25.
Put a 25 multiple on this number by the end of next quarter (Dec 2014) and I get a target price of $81+....pretty much in line with what I've suggested earlier that LCI should/will be an $80 stock.
Just my $.02
after strong breakout run. With EPS to be released next week, I expect a resumption of the uptrend. The week after the earnings report, the company is doing a presentation to investors (forget who the sponsor was).
Interesting that, even tho LCI preannounced EPS to be $.91-.94, Yahoo is slow to move their numbers up to match what I think the company has "in the bag."
Still believe LCI is an $80 stock (perhaps two quarters out) hiding in the low $50's. But we'll see.
Let me also add that LCI made a new all-time high today while the markets are still off their highs. I interpret this relative strength outperformance as a good sign. Recall that I posted recently that I believe that LCI is really an $80 stock....give it two quarters to get there but that's where it appears to me we're headed.
LCFI, as of their latest reporting period, has $146 million in cash on their balance sheet and virtually no debt. Why they would do a secondary is beyond me. In fact, they did an offering about two years ago (I don't have the exact date) so it would be unlikely they would have to/want to go back into the market to raise any additional capital. They have enough resources on hand to be able to fund any decent sized acquisition and management can certainly pare back their holdings (should they so desire) without the need to register an offering.
Tell me what I'm missing?
Pardon the pun but RUSH appears to be firing on all cylinders, handily beating street estimates by more then 11% accompanied by revenues that slightly topped estimates.
Interesting to watch LNN go counter to the market big time these last few days. Besides the large short position and the company's buy-back plan, I'm wondering if there's anything else at work here.
The company already has an active share repurchase program in place and underway.
As of 9/15, short interest was 4.6 million shares. This represented 37+% of the company's float and, at its current trading rate, would take 32 days to cover....Days to cover assume that all buying is cover purchases which, as most investors know, is HIGHLY unlikely.